A special Web section of the IRS site unveiled tax relief for homeowners who lose their home to foreclosure.
The IRS is taking steps to reassure homeowners that even though mortgage workouts, short sales, and foreclosures can result in income tax consequences - - - special tax relief provisions can greatly assist distressed borrowers.
The new section contains a diversification of useful data and worksheets.
Borrowers who have their mortgage debt reduced or elimated will receive Form 1099-C from the lending institution. By carefully examining the Form 1099-C they should be able to discern if the forgiven mortgage debt amount is properly reflected.
Related Item:Questions and Answers on Home Foreclosure and Debt Cancellation
Michael Lozar
Bellingham Mortgage Advisor
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