I just heard from my husband that the forgiveness bill of 2013 was not extended I am working with two short sales both were included in a bankruptcy my question is will these two home owners be responsible for paying tax on the difference between sales price and what was owed?
You need to be a member of Short Sale Superstars to add comments!
**********************************
like buttons
Replies
Bryant, I think you missed the BK part. Reta, have them talk to a CPA, but IF the debts were discharged in BK, there will be no tax for forgiven debt (the debt was discharged, therefore there was no "forgiveness").
They will receive a 1099. Taxes may or may not be owed depending on their financial situation. A lot of folks who have done a short sale can show insolvency on day of sale. They need to speak to a tax professional.