Short sales have become the best solution to avoid foreclosure. Most banks are not giving loan modifications and a Deed-in-lieu is still a foreclosure. With so many opinions, it is hard to know who and what to believe. Some people are choosing to walk away from their property rather than doing a short sale based on the fear of getting taxed on the difference. It is true that when you sell your property, you will get a 1099 from the bank. However, with the addition of the Mortgage Debt Relief Act of 2007, the difference of the sale price and balance of the loan may not be taxable. For instance, if you are short selling your primary residence, you will NOT be required to pay tax on the sale. But what about investment properties? In this case, it is a must to talk to a CPA that can determine your financial situation and see if the sale of the property will be taxable or not. There are other situations in which a cancellation of debt is not taxable. Click on the link above to learn more about the Mortgage Debt Relief Act. If you are in the Lee County Florida area and are considering a short sale, Don't hesitate to call or email us at no obligation to find out what your options are.
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John Roberts Realty - Eustis, FL
Call the "CHAMPION" for all your real estate needs
A home owner need to consult an Attorney before proceeding with a short sale to see if this is the best for their circumstances. Thanks for sharing his information.
Nov 15, 2010 04:48 AM
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