3 things to look at
Posted by aak5454 on June 19, 2007 at 12:36:55:
In Reply to: Multiple Investment Properties Being Foreclosed, Advice posted by Sarah on June 19, 2007 at 11:16:27:
You need to become familiar with Form 1099C and IRS Pubs 544 and 908. The 1099C will be issued for any net debt forgiveness (debt amt-fair market value at time of foreclosure). The Pubs 544 and 908 will explain more about the treatment of the 1099C. In general, the amount of the 1099 will be taxable unless you are insolvent (asset-liabilities<0) at the time of the sale or you file BK. In your case, since these were not person residence, you may have a deductible loss on the properties to offset some of that 1099 amt.
Consult a tax professional as there are numerous exceptions, etc can impact the final outcome with respetc to taxes.