Call Us Today: (619) 497-1040
 

Blog

Short Sales and Foreclosures How to Report

No Comments
March 30  |  Uncategorized  |   admin

During 2010 there has been a record number of foreclosures, short sales and forced sales for homeowners and real estate investors. As hard as it is to deal with the complexity of a real estate disposition, the paper work and anxiety doesn’t end there. Now comes the moment of truth, and some of the following questions arise: “How do I report the transaction on my tax return?”  “Will my short sale be subject to tax?” “I lost my house do I have to pay tax ?”

The answer is not easy because the rules differ from state to state. Here in California for example (which is a community property state) personal residence disposition (foreclosure or short sale or deed in lieu) is handled differently than an investment property.

Generally speaking, a disposition of a foreclosure on a personal residence will not be subject to tax (unless you borrowed money against your property and was used for other purposes).  If you used any of the debt against the property for other purposes, you may have a taxable event.

For real property used as an investment or rental, the rules get even more complicated.  First you have to determine on any debt forgiven how the debt needs to be allocated between recourse and non-recourse debt. Then gain or loss is calculated on the disposition.

Come see us. We are experts in involuntary conversions, short sales and foreclosures. Call us at 619-497-1040.

Welcome to the AWICPA Blog

No Comments
December 1  |  Company News  |   admin

Welcome to the blog of Anthony W. Imbimbo, CPA. Here at this blog you can find information not only about the practices of this business, but also about the industry in general. From advice and legal tips to current events in the industry, Anthony W. Imbimbo will provide you with sound information.

Here at www.awicpa.com, you can find a local San Diego CPA with a great deal of experience in accounting, taxation, auditing, forensic accounting, work process solutions, cash management issues, internal control analysis, setting up business models, and implementing accounting systems.

Page 3 of 3123