Sunday, June 26, 2016

Is Bankruptcy an Option for Tax Consequences from a Short Sale?

Question: My bank approved a short sale of my house. The difference between the sale price and the balance on my mortgage is $20,000. Will I owe income taxes on the difference? If I file for bankruptcy, will it make any difference?

Response: If you file a bankruptcy, your personal liability on the loan is discharged. However, if the property was your primary residence, there are laws in place to help avoid tax consequences. First, speak to your accountant and see if you need to consider a bankruptcy.  Tax liability on $20,000 might be minimal, or it could be completely avoided. Bankruptcy should be your last resort and it may be easily avoided.
As a New York State Licensed Real Estate Broker, Attorney Svetlana Kaplun has the expertise to assist interested homeowners in all steps of the short sale process including: bank negotiation and short sale approval, property listing and sale.
 
In the legal blog, Attorney Svetlana Kaplun addresses typical questions our firm has received from our clients, or come across from homeowners related to foreclosure, foreclosure defense, loan modification and bankruptcy topics.

The information contained in the legal blog of Attorney Svetlana Kaplun is for informational purposes only, and should not be construed as a legal advice on any subject matter. Please read our full disclaimer or contact the Law Office of Svetlana Kaplun, P.C. by telephone at 718-444-1115 for more information.
Copyright © 2016 Law Office of Svetlana Kaplun, P.C.

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