Village News - Also serving the communities of De Luz, Rainbow, Camp Pendleton, Pala and Pauma

Rep. Issa will kick you when you are down

 

Last updated 11/8/2007 at Noon



We hear all the bad news about defaults on mortgages. Lenders really do not want to take your property back in this kind of falling market. Repossessing homes and holding them months on end makes them no money, so they are trying to work out deals with homeowners before they default. In many cases they actually forgive part of the debt.

If a mortgage lender forgives debt as part of a short sale or foreclosure or what have you, they send the IRS a 1099 with the amount forgiven. At tax time you are obligated to report this forgiven mortgage debt as 1099 income. This amount is then taxed as o...



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