1099A no 1099C

[ljwalters]

Client lost home to foreclosure 1099A was received but no 1099 C. Do I just ignore the canceled debt for this year..

Also, Client made no payment in 2009 so no deductions there but what do do about the Points they were amortizing.

How do you get rid of them and can the be counted as interest when and if the 1099C comes in.

Thanks Linda and Buddy

[BulldogTom]

Linda,

Client won't get a 1099C. There is no COD income on the foreclosure of a non-recourse loan.

Tom

Lodi, CA

[ljwalters]

I'm pretty sur this is recource loan, they did a refinance to lowere interest a couple of years back.

Linda and buddy

[BulldogTom]

The 1099A will tell you. Look for the box that is checked for "borrower is personally liable for this loan" or "borrower is not personally liable for this loan".

Tom

Lodi, CA

[ljwalters]

the box borrower is personally liable for this loan.

Linda

[ACS41]

the box borrower is personally liable for this loan.

Linda

They will eventually get one once the bank sells the property.

[jainen]

>>Do I just ignore the canceled debt for this year<<

Why do you think there was any cancelled debt? If it was a non-recourse loan, the debt was satisfied in full by the property itself. That's what non-recourse means. If it was a recourse loan (which it apparently was), they still owe whatever they still owe. That's what recourse means. That's what personally liable means. Even if the bank takes the house for whatever value, they still owe the rest of the balance due. That's what no 1099-C means.