01-29-2011, 01:02 PM
Thank you for the additional info, oink and John. Nancy, I appreciate your passion on this topic! [
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I had read that there was a law passed regarding IRS liability on forgiven debt on a mortgage, something about the exemption being specific to a couple years, but I didn't have it in front of me, and I read it a while ago, so I thought it best not to mention it.
IIRC, the form that makes a person liable for any forgiven debt is a 1099C issued by the debt holder. Before a person starts to negotiate any kind of debt forgiveness, it is good to get be clear that no 1099C will be issued.
You can clear a mortgage debt in bankruptcy, but you cannot clear a debt to the IRS!
]I had read that there was a law passed regarding IRS liability on forgiven debt on a mortgage, something about the exemption being specific to a couple years, but I didn't have it in front of me, and I read it a while ago, so I thought it best not to mention it.
IIRC, the form that makes a person liable for any forgiven debt is a 1099C issued by the debt holder. Before a person starts to negotiate any kind of debt forgiveness, it is good to get be clear that no 1099C will be issued.
You can clear a mortgage debt in bankruptcy, but you cannot clear a debt to the IRS!