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Financial Planning / Tax Strategies


Subject:  Re: foreclosure Date:  3/7/2014  8:32 PM
Author:  culcha Number:  120395 of 127614

Your proceeds will be the loan payoff from the foreclosure PLUS the "excess funds" received. That amount, compared to your adjusted basis (after depreciation) will be your gain/loss.

And you report the gain/loss on Form 4797, and from there the net capital gain flows to Schedule D. But if it's a net loss, it's ordinary. And gain on any personal property involved will also be ordinary. Any gain on personal property is recaptured as ordinary to the extent of depreciation taken.

I think I've got it now! THANKS!

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