Tax Prep by Deb Posted March 10, 2009 Report Share Posted March 10, 2009 I have a client who was given a 1099-A with an amount of $488,975.48 in box 2 (balance of principal outstanding) and box 4 (fmv of property) with box 5 checked that borrower was not personally liable for loan. Then they also received a 1099C which shows box 2 (amount of debt canceled) $291,735.05 and in box 3 (interest if included in box 2) $30,783.39, and in box 7 (fmv) $240,000.00). My question is basically dealing with box 3. What if anything do I need to do with this amount? How does this get figured into the equation? Thanks for any help, Deb! Quote Link to comment Share on other sites More sharing options...
RoyDaleOne Posted March 10, 2009 Report Share Posted March 10, 2009 See Page 2 of Pub 4861 Interest included in canceled debt. http://www.irs.gov/publications/p4681/index.html Quote Link to comment Share on other sites More sharing options...
Tax Prep by Deb Posted March 11, 2009 Author Report Share Posted March 11, 2009 See Page 2 of Pub 4861 Interest included in canceled debt. http://www.irs.gov/publications/p4681/index.html Thanks, I knew I had read that in that publication but I could not find it. I am getting so tired of thinking on these foreclosures! Deb! Quote Link to comment Share on other sites More sharing options...
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