Author Topic: Tax advice for dad  (Read 1907 times)

mozar

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Tax advice for dad
« on: April 19, 2014, 05:24:43 PM »
Hello mustachians,
« Last Edit: May 10, 2018, 11:36:39 AM by mozar »

Catbert

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Re: Tax advice for dad
« Reply #1 on: April 20, 2014, 10:10:17 AM »
So is this his primary residence or a rental?  What would his past years of tax filing show in this regard?

The tax forgiveness program might still be a possibility for this year if it's his primary residence.  Not authorized now, but congress may well approve it retroactively.  Also if he's "insolvent" then the income tax on loan forgiveness won't apply.  I'm not sure exactly what the definition of "insolvent" is in the IRS's mind.  Being BK would meet the definition I think. 

If it was an investment property then he might be able to take the investment loss which might offset the loan forgiveness.  Not sure exactly how the accounting works if it's moved back and forth between principle residence and rental.

Maybe time to talk to a tax account or tax attorney.  (Unless by my bumping this thread one on here wants to chime in.)

Catbert

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Re: Tax advice for dad
« Reply #2 on: April 20, 2014, 02:14:49 PM »
BK = bankrupt.  The ultimate way to prove you're insolvent.

mozar

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Re: Tax advice for dad
« Reply #3 on: April 21, 2014, 05:14:24 PM »
Oh. OK. Thanks.