Short Sale 1099 Tax
I have sold my property 600K and owned bank 700K (short sale) and the bank issues 1099 with 100K for deft relief. Is this 100K is consider as ordinary income or short term capital gain ? is the tax rate on 100K is 15 % ?
I have no access and own 20K credit card, is there anyway that i can ask IRS forgive to tax on 100K which mean i don't have to pay tax on 100K.
Thanks
The IRS considers forgiven debt as income, ordinary income. However, that income may be exempt from taxation...
A CPA will be able to help you document your financial condition at the instant the debt was forgiven... and you may be able to avoid paying tax on all or part of the $100,000.