Form 982 line 10

[gmorin2]

Hi!

Background: filing for insolvency. So I have my 1099-C. Made a worksheet of all my assets and liabilites to show my insolvency. After some searching online and the instructions from the IRS Form 982 I have to fill out line 1b (in my case), line 2, and then step 3.

Step 3 I have no idea what it means at all. Can someone tell me it in plain terms:

3. Include on line 10a the smallest of (a) the basis of your nondepreciable property, ( the amount of the nonbusiness debt included on line 2, or © the excess of the aggregate bases of the property and the amount of money you held immediately after the discharge over your aggregate liabilites after the discharge.

My assets are: Car - 3800, checking account 1200.

My liabilites: student loans 19,000, medical 1500, credit card 12,000.

Thanks for anyone that responds.

Guy M.

Bangor <_<

[kcjenkins]

Are you a tax preparer, or are you just trying to do your own tax return, and got on this group by accident?

[jainen]

>>Can someone tell me it in plain terms:<<

The only technical term in the sentence is "basis." Everything else has its normal meaning, and even that word is pretty standard. How it all might apply to your particular circumstances is more complicated than the basic theory. Generally I wouldn't recommend you try to define insolvency without some accounting knowledge or help. However, based on what you report, it appears that your liabilities are several times your assets so I wouldn't worry about the details if you don't feel like getting personal help.

[gmorin2]

Are you a tax preparer, or are you just trying to do your own tax return, and got on this group by accident?

Calling the IRS, they tell me if I have settled a credit card debt and plan on filing insolvency, all i need to do is fill in line 1b, 2, and 10. After looking at line 10, I think 10 is the asset?

To answer your question, i'm just a taxpayer. i just found this site that has some good info. Only problem about this site is that many "key" terms are four or less letters i.e. form, IRS, 982, 1040 which makes the search invalid: must search for terms greater than 4 letters...

[kcjenkins]

Well, while we are not mad at you for posting here, this is actually a board for tax professionals, so it is natural that the specialized terms are confusing to you. The reason we are very hesitant to answer questions from non-professionals is not because we are mean, or stingy with our knowledge, although you should remember that our knowledge is what we have to sell.

The main reason that we don't like to answer questions like yours is that we know that we may do you more harm than good. When we try to answer questions from non-professionals, we know from experience that they will often misunderstand the answer, and end up doing something that hurts themselves, due to lack of understanding of the complexities. Also, we know that often it is the one piece of information that the person forgets to tell us, that causes a good answer to be all wrong. So much of tax law is so complex that we often have to insist on first seeing the documentation, before we can answer even our own clients, even tho they are going to pay us for our answers.

I would strongly advise you, in your situation, to go talk to a tax professional in your town. Believe me, the cost will be nothing, compared to the problems you could cost yourself if you goof in a situation like yours. Or even if you just end up with a bunch of letters from the IRS to deal with. Avoiding that situation is worth a few bucks to most people.

[zeke]

Well said KC.

[Booger]

Hi!

Background: filing for insolvency. So I have my 1099-C. Made a worksheet of all my assets and liabilites to show my insolvency. After some searching online and the instructions from the IRS Form 982 I have to fill out line 1b (in my case), line 2, and then step 3.

Step 3 I have no idea what it means at all. Can someone tell me it in plain terms:

3. Include on line 10a the smallest of (a) the basis of your nondepreciable property, ( the amount of the nonbusiness debt included on line 2, or © the excess of the aggregate bases of the property and the amount of money you held immediately after the discharge over your aggregate liabilites after the discharge.

My assets are: Car - 3800, checking account 1200.

My liabilites: student loans 19,000, medical 1500, credit card 12,000.

Thanks for anyone that responds.

Guy M.

Bangor

Hey, see my reply at bottom of this thread.

Booger

[SCL]

as kc suggests, things not said or said incorrectly, affect an answer.

for me, a missing ingredient that you omit is : how much is your 1099c total?

fwiw (nothing), and off the top of my head, it does seem that you have an insolvency possibility - but i have not looked at fm 982.

are you meaning bankruptcy, and not insolvency?

good luck in getting your financial life in order.