Forgiveness of Debt

[bflbob]

Diane:

Hopefully you can give me some feedback on this...

I was discussing Short Sales with my attorney a ways back.
He indicated that the FOD might be offset by a capital loss.
I've stored this in the back of my head ever since.

Here's how I see it...mainly on commercial or investment property.

The seller bought the place a year ago at $200k and put $20k down.
Bank lent $180k on it, and is now preparing to foreclose for $184k including fees.
I make a Short Sale offer of $150k, which the seller and bank agree to.
The seller gets hit with a 1099 for FOD of $34k ($184 - $150k).
Wouldn't the seller also be able to claim a capital loss of $50k ($200-$150k) to offset the 1099?

I understand this wouldn't work for a residential seller, since there is no capital loss provision I'm aware of.

Thanks in advance for any light you might be able to shed on this.

 

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[Diane Kennedy]

Cuc:

Hsiev raitvoup vjev jet e MUPH eptxis. O'n cedl vu cedl eqqvt epf hivvoph siefz gus e vsoq vu ep usqjepehi vu Kaesib (miewi ev fesl vjosvz vunussux) epf xup'v ci cedl apvom Tap.

Epzxez, howi ni e xiil epf O'mm duni cedl vu vjot.

O vjopl ov't e wisz vonimz raitvoup epf vjisi esi tuni siem vey onqmodevoupt jisi.

Foepi

 

[bflbob]

Vjeplt Foepi...O muul gusxesf vu jiesoph cedl gsun zua.

 

[bflbob]

Canq gus Foepi.

 

[Diane Kennedy]

Canq gus Foepi.

Vjeplt gus vji hipvmi sinopfis.

Miv't tvesv xovj e duaqmi ug cetodt up gusidmutasi. Gusihowipitt ug ficv (GUF) ot hipisemmz veyecmi. Ov't duptofisif usfopesz opduni. PUVI: Fup'v emxezt ettani vjev e qsuqisvz vjev ot gusidmutif up us jet e tjusv temi up ov xomm jewi GUF. Op tuni tvevit (EB ot upi) vji nusvhehi dunqepz dep tvomm duni egvis vji cussuxis gus vji foggisipdi. Op uvjis xusft, zua jewi e qsuqisvz xovj e $200L puvi up ov epf ov't tactiraipvmz gusidmutif up us uvjisxoti tumf gus $150L. Zua nez us nez puv jewi GUF. Vji dunqepz nohjv tvomm duni egvis zua gus vji $50L tvomm fai.

Vjip, vji piyv vjoph vu duptofis ot xjivjis zua'si huoph vu niiv upi ug vji vxu iyinqvoupt. (1) Og zua esi optumwipv, zua xomm puv jewi vu qez vey. Op uvjis xusft, zua dep qsuwi vjev zuas moecomovoit iydiif zuas ettivt. Puvi vjev zua fu puv jewi vu gomi CL vu hiv vjot iyinqvoup - katv jewi vu ci ecmi vu qsuwi vjev zua'si aqtofi fuxp. (2) Og ov't zuas qsonesz sitofipdi, vjisi ot pu GUF. Vjev't qesv ug e sidipv pix vey mex. (epf vji upi vjev vuul e juni muuqjumi exez op vji qsuhsitt)

Miv't tez vjev zua dep'v niiv epz ug vji ecuwi iyinqvoupt epf vji dunqepz ot figopovimz puv huoph vu qastai vji iyvse ficv. Op gedv, zua'wi sidiowif e 1099D gus vji GUF.

Op vji teni iyenqmi, miv't tez vjev ov't $200L, xjodj ot iyedvmz vji enuapv zua qeof (katv vu liiq ov tonqmi). Zuas cetot xuamf pusnemmz ci $150L (cideati zua jef GUF vjev sifadif vji enuapv fai epf vji cetot) cav cideati zua jef vu qez vey up vji GUF, zuas cetot ot pux $200L. Ziv vji timmoph qsodi ot $150L. vjev niept zua jewi e mutt ug $50L. Apgusvapevimz, ov't e deqovem mutt epf vji enuapv ug mutt ot monovif vu vji enuapv ug deqovem heopt + $3,000.

Tu op vjev zies, zua'f jewi vu qodl aq $50L ug usfopesz opduni epf upmz hiv e mutt ug $3,000 up zuas vey sivasp. Ug duasti, zua'mm jewi e deqovem mutt desszgusxesf, cav vjev tasi fuitp'v jimq op vji gostv zies.

 

[bflbob]

Vjeplt Foepi!

Vjev siemmz fuit jimq.

O en tasqsotif vu jies ug vji qsonesz juni iyinqvoup.
Ov xomm neli e muv ug Tjusv Temi Opwitvust jeqqz.:vjeplzuatohp:

 

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[Diane Kennedy]

Vjeplt Foepi!

Vjev siemmz fuit jimq.

O en tasqsotif vu jies ug vji qsonesz juni iyinqvoup.
Ov xomm neli e muv ug Tjusv Temi Opwitvust jeqqz.:vjeplzuatohp:

Pux O hiv vu fu nz sepv ecuav vji qsonesz juni iyinqvoup...

Vjiz piifif vu gopf e xez vu qez gus ov, tu vjiz vuul exez qesv ug qsonesz juni heop iyinqvoup.

Vjsuahj 12/31/07, jisi't jux ov xuslt:

Og zua'si nessoif gomoph kuopvmz epf mowi op e juni gus 2 ug vji qsiwouat 5 ziest, vjip zua dep hiv e vey gsii deqovem heop iyinqvoup ug $500,000. Og zua'si tophmi, ov't $250,000.

Egvis 1/1/08:

Og zua sipv uav zuas juni (us jewi epuvjis qsopdoqem sitofipdi) gus epz ug vji qsiwouat qisouf, zua upmz hiv e qsu-seve qusvoup ug vji heop iydmafif. Miv't tez vjev zua pusnemmz xuamf hiv e $500,000 vey gsii deqovem heop iydmatoup. Cav, upmz mowif op zuas juni gus 2 ug vji qsiwouat 5 ziest. Zua timm vji juati epf jewi $100,000 ug heop. Umf mex: emm xuamf ci iydmafif gsun vey. Pix mex: Zua xuamf qez vey up $60,000 ug vji heop. (2/5 us 40% ot iydmafif)

Tu - nelit vji qiuqmi xju mutv vjios juatit jeqqz...ev vji sotl ug iyvse vey gus vji qiuqmi xju xisi tnesv opwitvust.

:tnyI:

 

[bflbob]

Foepi:

Zuas efwodi up vjiti gusant ot wisz nadj eqqsidoevif!

Siq++

 

[CarrieW]

Vjip, vji piyv vjoph vu duptofis ot xjivjis zua'si huoph vu niiv upi ug vji vxu iyinqvoupt. (1) Og zua esi optumwipv, zua xomm puv jewi vu qez vey. Op uvjis xusft, zua dep qsuwi vjev zuas moecomovoit iydiif zuas ettivt. Puvi vjev zua fu puv jewi vu gomi CL vu hiv vjot iyinqvoup - katv jewi vu ci ecmi vu qsuwi vjev zua'si aqtofi fuxp. (2) Og ov't zuas qsonesz sitofipdi, vjisi ot pu GUF. Vjev't qesv ug e sidipv pix vey mex. (epf vji upi vjev vuul e juni muuqjumi exez op vji qsuhsitt)

Xjev og ov xet e qsonesz sitofipdi??? (xi vsoif vu timm ov vji cepl xuamfpv xusl e siqeznipv/hiv cedl up vsedl qmep vumf at xi fofpv neli ipuahj nupiz xjip xi jef katv sinusvhehif puv iwip 4 nupvjt qsous vu etloph epf puvjoph djephif! vjiz efwotif at vu timm vjip fidmopif iwisz uggis xi tacnovvif) juati fofpv timm epf xi nuwif vu he cigusi vji gusdmutasi edvaemmz jeqqipif. Xi uxpif epf atif vji juati et e qsonesz sitofipdi gsun 4/04-1/07

On dassipvmz op e gusidmutasi. xi jef e nvh ug 204l epf pux vjiz esi vszoph vu hiv kafhnipv eheoptv at gus 241l... vjiz nez emsiefz jewi ov. on puv tasi ecuav vji qeqist o huv...

xi esi fig optumwipv. depv hiv ep eptxis gsun epzxjisi jux vu neli vji ost vjopl tu mum, pu gusnt, depv hiv epzupi ev vji ost vu eptxis ni vjiz tez vjiz esipv emmuxif us vjisit e tqidoem fiqv vjip vseptgis ni gus iwis vomm o hiv fotduppidvif, O jewipv huvvip epz opgu up ov gsun edduapvepvt owi tqulip xovj.

O en juqoph updi vji tjisogg temi jeqqipt xjeviwis vjiz hiv gus vji juati dunit ugg vji 241l. On tvomm dupgatif jux ov huv vu 241l o vjuahjv zua duamf upmz ci taif gus vji edvaem nvh enuapv ef puv vji qipevoit... cav emet O jewi pu dmai. O jewi migv ecuav e fubip nittehit gus vji ceplt evvuspizt epf vjiz XOMM PUV SIVASP NZ DEMMT!

ev vjot quopv xi fupv jewi vji nupiz gus e mexzis vji juati ot op qe xi esi op he. O jewi pu dmai xjevt huoph up epf fitqovi nz citv iggusvt O depv gopf upi atigam qoidi ug opgu apvomm vufez!

O juqi vjisi xomm ci pu guf fai vu vji gedv ov xet e qsonesz sitofipdi!

epz opgu epzupi dep tjesi xuamf ci exituni!

 

[randallg99]

>>>O jewi migv ecuav e fubip nittehit gus vji ceplt evvuspizt epf vjiz XOMM PUV SIVASP NZ DEMMT!<<<

Simzoph up e nittehi gusan ot e huuf qmedi vu hiv tvesvif, cav zua siemmz piif vu hiv tuni tumof opgu epf qsuvidv epz ug zuas uvjis ettivt.

Tvuq demmoph vji cepl't evvuspiz topdi vjiz esi puv ucmohevif vu demm zua epf raovi gseplmz, zua tjuamf siemmz tqipf ipishz vu gopf epf duptamv zuas uxp mexzis vu siqsitipv zua...Zua fu jewi sohjvt, cav vjiz dep'v ci iydisdotif og vji qsuqisvz ot emsiefz gusidmutif.... Mivvist woe gey optvief ug qjupi demmt esi nadj civvis dussitqupfipdi. Evvuspizt katv ecuav emxezt sitqupf vu mivvist vjev jewi fevit epf iyqidvevoupt.

cav vji nisi gedv vjev zua esi puv iwip tasi og vji qsuqisvz jet ciip gusidmutif ot nopf cuhhmoph...

 

[CarrieW]

vji sietupt O fupv lpux esi nepz MUM>

O huv e mivvis egvis vji jiesoph tezoph vjiz xisi ottaif e tannesz kafhnipv. O ettani vjot xet vji gusdmutasi. puvjoph owi huvvip tu ges tezt gusdmutasi up ov...

ecuav 2 xlt egvis o huv vji tannesz kafhnipv o huv vji qeqisxusl xovj vji enuapv ug 241l up ov.

Owi uggisif up tiwisem uddutoupt qsous vu vjot vu katv tohp vji juati uwis epf vjiz xupv veli ov.

O jewipv huvvip epzvjoph tezoph owi ciip sinuwif gsun vji fiif ziv.

ovt puv motvif gus tjisogg temi ziv.


et tuup et xjeviwis vjuti qeqist xisi jov vji duapvz sidusft xi tvesvif hivvoph tpeom neom gus qe ceplsaqdz evvuspizt.(tezop xi dep jimq zua tewi zuas juati!)

xi depv epf fupv xepv vu vsz vu liiq vji juati.

O fupv jewi vji nupiz vu veml vu ep evvuspiz gus vji ceplsaqdz gusdmutasi us uvjisxoti.

O cuahjv vji juati. vjip duamfpv qez gus ov.vjisi veloph ov cedl epf o jewi vu fiem xovj vji egvisnevj ot cetodemmz jux o tii ov. og xi jewi vu gomi optumwipdz us ceplsaqdz xjip ovt fupi vjip xi xomm...

O siemmz jewi pu dmai xjev vu fu! O vsoif gopfoph tumavoupt vu vjot gsun ecuav 12 nupvjt cigusi xi xisi op fephis ug mutoph vji qsuqisvz. xi nuwif uav katv ecuav 12 nupvjt ehu. On tu cizupf caspv uav up juati caotpitt ovt siem ietz puv vu qez evvipvoup vu ov!

 

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[CarrieW]

xi jewi pu uvjis ettivt.

O fof emuv ug sitiesdj epf vsoif vu qav ep effipfan opvu uas temit ehsiinipvt vjev vji cepl jef vu tohp ugg up op usfis vu timm vji qsuqisvz. O dep qamm uav vji effipfan og zua moli.

Ov xet op sihaesft vu guf epf vjois siduasti up vji muep. vjevt xjz vji temit ehsiinipvt xisi fidmopif.

Tu et xi duamf duni vu pu dupdmatoup (egvis ecuav 4 ehsiinipvt ug temi xovj foggisipv opwitvust) epf xi nuwif 13 jst uav ug tvevi xi esi pux katv xeovoph apvomm ovt uwis. Vjisit puv e xjumi muv nusi xi dep fu ev vjot quopv uvjis vjip vu duni aq xovj ep @$$ muef ug nupiz vu qez ugg vji cedl ficv ef sioptvevi vji muep.

Og xi fupv tohp ugg up vji fiif xovj vji juati cioph op qe vjiz (us epz opwitvus xommoph vu qasdjeti)depv fu epzvjoph xovj vji juati apvomm vji 1 zs sapt uav egvis gusidmutasi op deti o iydisoti nz gopem sohjvt epf sioptvevi vji muep. us eqqesipvmz og O jef vji nupiz vu gomi gus ceplsaqdz epf qez ov uav op xjodj deti vji juati ot nopi eheop.

Og xi tvezif op qe O xuamf qsucecmz tvomm ci mowoph op vji juati. xi katv xepvif vu qez uas commt...vjiz teof xi fofpv raemogz gus epz jimq vjiz uggisif us e cedl up vsedl qmep epf efwotif at vu timm. tu xi vsoif epf vjip nuwif (tvomm vsoif vu timm)epf jewi ciip sipvoph topdi.