Legal Question in Credit and Debt Law in Georgia
our home was foreclosed on and sold in a non-judicial auction infront of the courthouse. Everywhere I've looked says that in Georgia the mortgager only has 30 days to file for the deficiency balance. That's been months ago, and we never received anything from them to the effect that they filed. Now we received a 1099A instead of a 1099C, why, if they are no longer able to pursue a deficiency against us, have they not forgiven this debt and sent us a 1099c?
3 Answers from Attorneys
Generally, a 1099A is sent when a lender has foreclosed. See a CPA for specific advice on how this affects your taxes.
Being able to sue you for the deficiency (which is a question of state law) and what form the IRS requires (a question of federal law) may produce what appear to you as somewhat conflicted outcomes. See a tax advisor (a real CPA and not something like HR Block) as there are ways in a foreclosure to address the 1099.
You are confusing things. Just because a lender chooses not to seek out a deficiency judgment has nothing to do with the 1099 for tax purposes. To the extent that any excess indebtedness may be reported in your income, consider filing form 982 to exclude all or part of the reported income. Further, they are required by law to file the 1099 if they are not pursuing a judgment against you. Any amount over $600 does have to be reported to the IRS.
I am not a tax attorney or a CPA. You need tax advice and should consult a tax attorney or qualified tax preparer who will know about this.
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