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Can Ie File 2012 Taxes Now

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Can Ie File 2012 Taxes Now

Can ie file 2012 taxes now 4. Can ie file 2012 taxes now   Detailed Examples Table of Contents These examples use actual forms to help you prepare your income tax return. Can ie file 2012 taxes now However, the information shown on the filled-in forms is not from any actual person or scenario. Can ie file 2012 taxes now Example 1—Mortgage loan modification. Can ie file 2012 taxes now    In 2007, Nancy Oak bought a main home for $435,000. Can ie file 2012 taxes now Nancy took out a $420,000 mortgage loan to buy the home and made a down payment of $15,000. Can ie file 2012 taxes now The loan was secured by the home. Can ie file 2012 taxes now The mortgage loan was a recourse debt, meaning that Nancy was personally liable for the debt. Can ie file 2012 taxes now In 2008, Nancy took out a second mortgage loan (also a recourse debt) in the amount of $30,000 that was used to substantially improve her kitchen. Can ie file 2012 taxes now    In 2011, when the outstanding principal of the first and second mortgage loans was $440,000, Nancy refinanced the two recourse loans into one recourse loan in the amount of $475,000. Can ie file 2012 taxes now The FMV of Nancy's home at the time of the refinancing was $500,000. Can ie file 2012 taxes now Nancy used the additional $35,000 debt ($475,000 new mortgage loan minus $440,000 outstanding principal of Nancy's first and second mortgage loans immediately before the refinancing) to pay off personal credit cards and to pay college tuition for her son. Can ie file 2012 taxes now After the refinancing, Nancy has qualified principal residence indebtedness in the amount of $440,000 because the refinanced debt is qualified principal residence indebtedness only to the extent the amount of debt is not more than the old mortgage principal just before the refinancing. Can ie file 2012 taxes now   In 2013, Nancy was unable to make her mortgage loan payments. Can ie file 2012 taxes now On August 31, 2013, when the outstanding balance of her refinanced mortgage loan was still $475,000 and the FMV of the property was $425,000, Nancy's bank agreed to a loan modification (a “workout”) that resulted in a $40,000 reduction in the principal balance of her loan. Can ie file 2012 taxes now Nancy was neither insolvent nor in bankruptcy at the time of the loan modification. Can ie file 2012 taxes now   Nancy received a 2013 Form 1099-C from her bank in January 2014 showing canceled debt of $40,000 in box 2. Can ie file 2012 taxes now Identifiable event code "F" appears in box 6. Can ie file 2012 taxes now This box shows the reason the creditor has filed Form 1099-C. Can ie file 2012 taxes now To determine if she must include the canceled debt in her income, Nancy must determine whether she meets any of the exceptions or exclusions that apply to canceled debts. Can ie file 2012 taxes now Nancy determines that the only exception or exclusion that applies to her is the qualified principal residence indebtedness exclusion. Can ie file 2012 taxes now   Next, Nancy determines the amount, if any, of the $40,000 of canceled debt that was qualified principal residence indebtedness. Can ie file 2012 taxes now Although Nancy has $440,000 of qualified principal residence indebtedness, part of her loan ($35,000) was not qualified principal residence indebtedness because it was used to pay off personal credit cards and college tuition for her son. Can ie file 2012 taxes now Applying the ordering rule, the qualified principal residence indebtedness exclusion applies only to the extent the amount canceled is more than the amount of the debt (immediately before the cancellation) that is not qualified principal residence indebtedness. Can ie file 2012 taxes now Thus, Nancy can exclude only $5,000 of the canceled debt as qualified principal residence indebtedness ($40,000 amount canceled minus $35,000 nonqualified debt). Can ie file 2012 taxes now   Because Nancy does not meet any other exception or exclusion, she checks only the box on line 1e of Form 982 and enters $5,000 on line 2. Can ie file 2012 taxes now Nancy must also enter $5,000 on line 10b and reduce the basis of her main home by the $5,000 she excluded from income, bringing the adjusted basis in her home to $460,000 ($435,000 purchase price plus $30,000 substantial improvement minus $5,000). Can ie file 2012 taxes now Nancy must also include the $35,000 nonqualified debt portion in income on Form 1040, line 21. Can ie file 2012 taxes now You can see Nancy's Form 1099-C and a portion of her Form 1040 below. Can ie file 2012 taxes now Nancy's 2013 Form 1099-C, Cancellation of Debt This image is too large to be displayed in the current screen. Can ie file 2012 taxes now Please click the link to view the image. Can ie file 2012 taxes now Form 1099-C, Cancellation of Debt Nancy's 2013 Form 1040 This image is too large to be displayed in the current screen. Can ie file 2012 taxes now Please click the link to view the image. Can ie file 2012 taxes now Form 1040, U. Can ie file 2012 taxes now S. Can ie file 2012 taxes now Individual Income Tax Nancy's Form 982 This image is too large to be displayed in the current screen. Can ie file 2012 taxes now Please click the link to view the image. Can ie file 2012 taxes now Form 982 Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment)              Example 2—Mortgage loan foreclosure. Can ie file 2012 taxes now    In 2005, John and Mary Elm bought a main home for $335,000. Can ie file 2012 taxes now John and Mary took out a $320,000 mortgage loan to buy the home and made a down payment of $15,000. Can ie file 2012 taxes now The loan was secured by the home and is a recourse debt, meaning John and Mary are personally liable for the debt. Can ie file 2012 taxes now   John and Mary became unable to make their mortgage loan payments and on March 1, 2013, when the outstanding balance of the mortgage loan was $315,000 and the FMV of the property was $290,000, the bank foreclosed on the property and simultaneously canceled the remaining mortgage debt. Can ie file 2012 taxes now Immediately before the foreclosure, John and Mary's only other assets and liabilities were a checking account with a balance of $6,000, retirement savings of $13,000, and credit card debt of $5,500. Can ie file 2012 taxes now   John and Mary received a 2013 Form 1099-C showing canceled debt of $25,000 in box 2 ($315,000 outstanding balance minus $290,000 FMV) and an FMV of $290,000 in box 7. Can ie file 2012 taxes now Identifiable event code "D" appears in box 6. Can ie file 2012 taxes now This box shows the reason the creditor has filed Form 1099-C. Can ie file 2012 taxes now In order to determine if John and Mary must include the canceled debt in income, they must first determine whether they meet any of the exceptions or exclusions that apply to canceled debts. Can ie file 2012 taxes now In this example, John and Mary meet both the insolvency and qualified principal residence indebtedness exclusions. Can ie file 2012 taxes now Their sample Form 1099-C is shown on this page. Can ie file 2012 taxes now   John and Mary complete the insolvency worksheet and determine that they were insolvent immediately before the cancellation because at that time their liabilities exceeded the FMV of their assets by $11,500 ($320,500 total liabilities minus $309,000 FMV of total assets). Can ie file 2012 taxes now However, because the entire debt canceled is qualified principal residence indebtedness, the insolvency exclusion only applies if John and Mary elect to apply the insolvency exclusion instead of the qualified principal residence exclusion. Can ie file 2012 taxes now   John and Mary do not elect to apply the insolvency exclusion instead of the qualified principal residence exclusion because under the insolvency exclusion their exclusion would be limited to the amount by which they were insolvent ($11,500). Can ie file 2012 taxes now Instead, John and Mary check box 1e of Form 982 to exclude the canceled debt under the qualified principal residence exclusion. Can ie file 2012 taxes now Under the qualified principal residence exclusion, the amount that John and Mary can exclude is not limited because their qualified principal residence indebtedness is not more than $2 million and no portion of the loan was nonqualified debt. Can ie file 2012 taxes now As a result, John and Mary enter the full $25,000 of canceled debt on line 2 of Form 982. Can ie file 2012 taxes now Because John and Mary no longer own the home due to the foreclosure, John and Mary have no remaining basis in the home at the time of the debt cancellation. Can ie file 2012 taxes now Thus, John and Mary leave line 10b of Form 982 blank. Can ie file 2012 taxes now   John and Mary must also determine whether they have a gain or loss from the foreclosure. Can ie file 2012 taxes now John and Mary complete Table 1-1 (shown below) and find that they have a $45,000 loss from the foreclosure. Can ie file 2012 taxes now Because this loss relates to their home, it is a nondeductible loss. Can ie file 2012 taxes now   John and Mary's Form 1099-C, Insolvency Worksheet, and Form 982 follow. Can ie file 2012 taxes now John and Mary's 2013 Form 1099-C, Cancellation of Debt This image is too large to be displayed in the current screen. Can ie file 2012 taxes now Please click the link to view the image. Can ie file 2012 taxes now Form 1099-C, Cancellation of Debt Table 1-1. Can ie file 2012 taxes now Worksheet for Foreclosures and Repossessions (for John and Mary Elm) Part 1. Can ie file 2012 taxes now Complete Part 1 only if you were personally liable for the debt (even if none of the debt was canceled). Can ie file 2012 taxes now Otherwise, go to Part 2. Can ie file 2012 taxes now 1. Can ie file 2012 taxes now Enter the amount of outstanding debt immediately before the transfer of property reduced by any amount for which you remain personally liable immediately after the transfer of property $315,000. Can ie file 2012 taxes now 00 2. Can ie file 2012 taxes now Enter the fair market value of the transferred property $290,000. Can ie file 2012 taxes now 00 3. Can ie file 2012 taxes now Ordinary income from the cancellation of debt upon foreclosure or repossession. Can ie file 2012 taxes now * Subtract line 2 from line 1. Can ie file 2012 taxes now If less than zero, enter zero. Can ie file 2012 taxes now Next, go to Part 2 $ 25,000. Can ie file 2012 taxes now 00 Part 2. Can ie file 2012 taxes now Gain or loss from foreclosure or repossession. Can ie file 2012 taxes now   4. Can ie file 2012 taxes now Enter the smaller of line 1 or line 2. Can ie file 2012 taxes now If you did not complete Part 1 (because you were not personally liable for the debt), enter the amount of outstanding debt immediately before the transfer of property $290,000. Can ie file 2012 taxes now 00 5. Can ie file 2012 taxes now Enter any proceeds you received from the foreclosure sale   6. Can ie file 2012 taxes now Add line 4 and line 5 $290,000. Can ie file 2012 taxes now 00 7. Can ie file 2012 taxes now Enter the adjusted basis of the transferred property $335,000. Can ie file 2012 taxes now 00 8. Can ie file 2012 taxes now Gain or loss from foreclosure or repossession. Can ie file 2012 taxes now Subtract line 7 from line 6 ($ 45,000. Can ie file 2012 taxes now 00) * The income may not be taxable. Can ie file 2012 taxes now See chapter 1 for more details. Can ie file 2012 taxes now Insolvency Worksheet—John and Mary Elm Date debt was canceled (mm/dd/yy) 03/01/13 Part I. Can ie file 2012 taxes now Total liabilities immediately before the cancellation (do not include the same liability in more than one category) Liabilities (debts) Amount Owed Immediately Before the Cancellation 1. Can ie file 2012 taxes now Credit card debt $ 5,500 2. Can ie file 2012 taxes now Mortgage(s) on real property (including first and second mortgages and home equity loans) (mortgage(s) can be on personal residence, any additional residence, or property held for investment or used in a trade or business) $ 315,000 3. Can ie file 2012 taxes now Car and other vehicle loans $ 4. Can ie file 2012 taxes now Medical bills owed $ 5. Can ie file 2012 taxes now Student loans $ 6. Can ie file 2012 taxes now Accrued or past-due mortgage interest $ 7. Can ie file 2012 taxes now Accrued or past-due real estate taxes $ 8. Can ie file 2012 taxes now Accrued or past-due utilities (water, gas, electric) $ 9. Can ie file 2012 taxes now Accrued or past-due child care costs $ 10. Can ie file 2012 taxes now Federal or state income taxes remaining due (for prior tax years) $ 11. Can ie file 2012 taxes now Judgments $ 12. Can ie file 2012 taxes now Business debts (including those owed as a sole proprietor or partner) $ 13. Can ie file 2012 taxes now Margin debt on stocks and other debt to purchase or secured by investment assets other than real property $ 14. Can ie file 2012 taxes now Other liabilities (debts) not included above $ 15. Can ie file 2012 taxes now Total liabilities immediately before the cancellation. Can ie file 2012 taxes now Add lines 1 through 14. Can ie file 2012 taxes now $ 320,500 Part II. Can ie file 2012 taxes now Fair market value (FMV) of assets owned immediately before the cancellation (do not include the FMV of the same asset in more than one category) Assets FMV Immediately Before  the Cancellation 16. Can ie file 2012 taxes now Cash and bank account balances $ 6,000 17. Can ie file 2012 taxes now Real property, including the value of land (can be main home, any additional home, or property held for investment or used in a trade or business) $ 290,000 18. Can ie file 2012 taxes now Cars and other vehicles $ 19. Can ie file 2012 taxes now Computers $ 20. Can ie file 2012 taxes now Household goods and furnishings (for example, appliances, electronics, furniture, etc. Can ie file 2012 taxes now ) $ 21. Can ie file 2012 taxes now Tools $ 22. Can ie file 2012 taxes now Jewelry $ 23. Can ie file 2012 taxes now Clothing $ 24. Can ie file 2012 taxes now Books $ 25. Can ie file 2012 taxes now Stocks and bonds $ 26. Can ie file 2012 taxes now Investments in coins, stamps, paintings, or other collectibles $ 27. Can ie file 2012 taxes now Firearms, sports, photographic, and other hobby equipment $ 28. Can ie file 2012 taxes now Interest in retirement accounts (IRA accounts, 401(k) accounts, and other retirement accounts) $ 13,000 29. Can ie file 2012 taxes now Interest in a pension plan $ 30. Can ie file 2012 taxes now Interest in education accounts $ 31. Can ie file 2012 taxes now Cash value of life insurance $ 32. Can ie file 2012 taxes now Security deposits with landlords, utilities, and others $ 33. Can ie file 2012 taxes now Interests in partnerships $ 34. Can ie file 2012 taxes now Value of investment in a business $ 35. Can ie file 2012 taxes now Other investments (for example, annuity contracts, guaranteed investment contracts, mutual funds, commodity accounts, interests in hedge funds, and options) $ 36. Can ie file 2012 taxes now Other assets not included above $ 37. Can ie file 2012 taxes now FMV of total assets immediately before the cancellation. Can ie file 2012 taxes now Add lines 16 through 36. Can ie file 2012 taxes now $ 309,000 Part III. Can ie file 2012 taxes now Insolvency 38. Can ie file 2012 taxes now Amount of Insolvency. Can ie file 2012 taxes now Subtract line 37 from line 15. Can ie file 2012 taxes now If zero or less, you are not insolvent. Can ie file 2012 taxes now $ 11,500 John and Mary's Form 982 This image is too large to be displayed in the current screen. Can ie file 2012 taxes now Please click the link to view the image. Can ie file 2012 taxes now Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment)          Example 3—Mortgage loan foreclosure with debt exceeding $2 million limit. Can ie file 2012 taxes now    In 2011, Kathy and Frank Willow got married and entered into a contract with Hive Construction Corporation to build a house for $3,000,000 to be used as their main home. Can ie file 2012 taxes now Kathy and Frank made a $400,000 down payment and took out a $2,600,000 mortgage to finance the remaining cost of the house. Can ie file 2012 taxes now Kathy and Frank are personally liable for the mortgage loan, which is secured by the home. Can ie file 2012 taxes now   In November 2013, when the outstanding principal balance on the mortgage loan was $2,500,000, the FMV of the property fell to $1,750,000 and Kathy and Frank abandoned the property by permanently moving out. Can ie file 2012 taxes now The lender foreclosed on the property and, on December 5, 2013, sold the property to another buyer for $1,750,000. Can ie file 2012 taxes now On December 26, 2013, the lender canceled the remaining debt. Can ie file 2012 taxes now Kathy and Frank have no tax attributes other than basis of personal-use property. Can ie file 2012 taxes now   The lender issued a 2013 Form 1099-C to Kathy and Frank showing canceled debt of $750,000 in box 2 (the remaining balance on the $2,500,000 mortgage debt after application of the foreclosure sale proceeds) and $1,750,000 in box 7 (FMV of the property). Can ie file 2012 taxes now Identifiable event code "D" appears in box 6. Can ie file 2012 taxes now This box shows the reason the creditor has filed Form 1099-C. Can ie file 2012 taxes now Although Kathy and Frank abandoned the property, the lender did not need to also file a Form 1099-A because the lender canceled the debt in connection with the foreclosure in the same calendar year. Can ie file 2012 taxes now Kathy and Frank are filing a joint return for 2013. Can ie file 2012 taxes now   Because the foreclosure occurred prior to the debt cancellation, Kathy and Frank first calculate their gain or loss from the foreclosure using Table 1-1. Can ie file 2012 taxes now Because Kathy and Frank remained personally liable for the $750,000 debt remaining after the foreclosure ($2,500,000 outstanding debt immediately before the foreclosure minus $1,750,000 satisfied through the sale of the home), Kathy and Frank enter $1,750,000 on line 1 of Table 1-1 ($2,500,000 outstanding debt immediately before the foreclosure minus the $750,000 for which they remained liable). Can ie file 2012 taxes now Completing Table 1-1, Kathy and Frank find that they have no ordinary income from the cancellation of debt upon foreclosure and that they have a $1,250,000 loss. Can ie file 2012 taxes now Because this loss relates to their home, it is a nondeductible loss. Can ie file 2012 taxes now   Because the lender later canceled the remaining amount of the debt, Kathy and Frank must also determine whether that canceled debt is taxable. Can ie file 2012 taxes now Immediately before the cancellation, Kathy and Frank had $15,000 in a savings account, household furnishings with an FMV of $17,000, a car with an FMV of $10,000, and $18,000 in credit card debt. Can ie file 2012 taxes now Kathy and Frank also had the $750,000 remaining balance on the mortgage loan at that time. Can ie file 2012 taxes now The household furnishings originally cost $30,000. Can ie file 2012 taxes now The car had been fully paid off (so there was no related outstanding debt) and was originally purchased for $16,000. Can ie file 2012 taxes now Kathy and Frank had no adjustments to the cost basis of the car. Can ie file 2012 taxes now Kathy and Frank had no other assets or liabilities at the time of the cancellation. Can ie file 2012 taxes now Kathy and Frank complete the insolvency worksheet to calculate that they were insolvent to the extent of $726,000 immediately before the cancellation ($768,000 of total liabilities minus $42,000 FMV of total assets). Can ie file 2012 taxes now   At the beginning of 2014, Kathy and Frank had $9,000 in their savings account and $15,000 in credit card debt. Can ie file 2012 taxes now Kathy and Frank also owned the same car at that time (still with an FMV of $10,000 and basis of $16,000) and the same household furnishings (still with an FMV of $17,000 and a basis of $30,000). Can ie file 2012 taxes now Kathy and Frank had no other assets or liabilities at that time. Can ie file 2012 taxes now Kathy and Frank no longer own the home because the lender foreclosed on it in 2013. Can ie file 2012 taxes now   Because the canceled debt is qualified principal residence indebtedness, the insolvency exclusion does not apply unless Kathy and Frank elect to apply the insolvency exclusion instead of the qualified principal residence indebtedness exclusion. Can ie file 2012 taxes now The maximum amount that Kathy and Frank can treat as qualified principal residence indebtedness is $2,000,000. Can ie file 2012 taxes now The remaining $500,000 ($2,500,000 outstanding mortgage loan minus $2,000,000 limit on qualified principal residence indebtedness) is not qualified principal residence indebtedness. Can ie file 2012 taxes now Because only a part of the loan is qualified principal residence indebtedness, Kathy and Frank must apply the ordering rule to the canceled debt. Can ie file 2012 taxes now Under the ordering rule, the qualified principal residence indebtedness exclusion applies only to the extent that the amount canceled ($750,000) exceeds the amount of the loan (immediately before the cancellation) that is not qualified principal residence indebtedness ($500,000). Can ie file 2012 taxes now This means that Kathy and Frank can only exclude $250,000 ($750,000 amount canceled minus $500,000 nonqualified debt) under the qualified principal residence indebtedness exclusion. Can ie file 2012 taxes now   Kathy and Frank do not elect to have the insolvency exclusion apply instead of the qualified principal residence exclusion. Can ie file 2012 taxes now Nonetheless, they can still apply the insolvency exclusion to the $500,000 nonqualified debt because it is not qualified principal residence indebtedness. Can ie file 2012 taxes now Kathy and Frank can exclude the remaining $500,000 canceled debt under the insolvency exclusion because they were insolvent immediately before the cancellation to the extent of $726,000. Can ie file 2012 taxes now Thus, Kathy and Frank check the boxes on lines 1b and 1e of Form 982 and enter $750,000 on line 2 ($250,000 excluded under the qualified principal residence indebtedness exclusion plus $500,000 excluded under the insolvency exclusion). Can ie file 2012 taxes now   Next, Kathy and Frank reduce their tax attributes using Part II of Form 982. Can ie file 2012 taxes now Because Kathy and Frank no longer own the home due to the foreclosure, Kathy and Frank have no remaining basis in the home at the time of the debt cancellation. Can ie file 2012 taxes now Thus, Kathy and Frank leave line 10b of Form 982 blank. Can ie file 2012 taxes now However, Kathy and Frank are also excluding nonqualified debt under the insolvency exclusion. Can ie file 2012 taxes now As a result, Kathy and Frank must reduce the basis of property they own based on the amount of canceled debt they are excluding from income under the insolvency rules. Can ie file 2012 taxes now Because Kathy and Frank have no tax attributes other than basis of personal-use property to reduce, Kathy and Frank figure the amount they must include on line 10a of Form 982 by taking the smallest of: The $46,000 bases of their personal-use property held at the beginning of 2014 ($16,000 basis in the car plus $30,000 basis in household furnishings), The $500,000 of the nonbusiness debt (other than qualified principal residence indebtedness) that they are excluding from income on line 2 of Form 982, or The $43,000 excess of the total bases of the property and the amount of money they held immediately after the cancellation over their total liabilities immediately after the cancellation ($15,000 in savings account plus $30,000 basis in household furnishings plus $16,000 adjusted basis in car minus $18,000 credit card debt). Can ie file 2012 taxes now Kathy and Frank enter $43,000 on Form 982, line 10a and reduce their bases in the car and the household furnishings in proportion to the total adjusted bases in all their property. Can ie file 2012 taxes now Kathy and Frank reduce the basis in the car by $14,956. Can ie file 2012 taxes now 52 ($43,000 x $16,000/$46,000). Can ie file 2012 taxes now And they reduce the basis in the household furnishings by $28,043. Can ie file 2012 taxes now 48 ($43,000 x $30,000/$46,000). Can ie file 2012 taxes now   Following are Kathy and Frank's sample forms and worksheets. Can ie file 2012 taxes now Frank and Kathy's 2013 Form 1099-C, Cancellation of Debt This image is too large to be displayed in the current screen. Can ie file 2012 taxes now Please click the link to view the image. Can ie file 2012 taxes now Form 1099-C, Cancellation of Debt Table 1-1. Can ie file 2012 taxes now Worksheet for Foreclosures and Repossessions (for Frank and Kathy Willow) Part 1. Can ie file 2012 taxes now Complete Part 1 only if you were personally liable for the debt (even if none of the debt was canceled). Can ie file 2012 taxes now Otherwise, go to Part 2. Can ie file 2012 taxes now 1. Can ie file 2012 taxes now Enter the amount of outstanding debt immediately before the transfer of property reduced by any amount for which you remain personally liable immediately after the transfer of property $1,750,000. Can ie file 2012 taxes now 00 2. Can ie file 2012 taxes now Enter the fair market value of the transferred property $1,750,000. Can ie file 2012 taxes now 00 3. Can ie file 2012 taxes now Ordinary income from the cancellation of debt upon foreclosure or repossession. Can ie file 2012 taxes now * Subtract line 2 from line 1. Can ie file 2012 taxes now If less than zero, enter zero. Can ie file 2012 taxes now Next, go to Part 2 $0. Can ie file 2012 taxes now 00 Part 2. Can ie file 2012 taxes now Gain or loss from foreclosure or repossession. Can ie file 2012 taxes now   4. Can ie file 2012 taxes now Enter the smaller of line 1 or line 2. Can ie file 2012 taxes now If you did not complete Part 1 (because you were not personally liable for the debt), enter the amount of outstanding debt immediately before the transfer of property. Can ie file 2012 taxes now $1,750,000. Can ie file 2012 taxes now 00 5. Can ie file 2012 taxes now Enter any proceeds you received from the foreclosure sale   6. Can ie file 2012 taxes now Add line 4 and line 5 $1,750,000. Can ie file 2012 taxes now 00 7. Can ie file 2012 taxes now Enter the adjusted basis of the transferred property $3,000,000. Can ie file 2012 taxes now 00 8. Can ie file 2012 taxes now Gain or loss from foreclosure or repossession. Can ie file 2012 taxes now Subtract line 7 from line 6 ($1,250,000. Can ie file 2012 taxes now 00) * The income may not be taxable. Can ie file 2012 taxes now See chapter 1 for more details. Can ie file 2012 taxes now    Insolvency Worksheet—Frank and Kathy Willow Date debt was canceled (mm/dd/yy) 12/26/13 Part I. Can ie file 2012 taxes now Total liabilities immediately before the cancellation (do not include the same liability in more than one category) Liabilities (debts) Amount Owed Immediately Before the Cancellation 1. Can ie file 2012 taxes now Credit card debt $ 18,000 2. Can ie file 2012 taxes now Mortgage(s) on real property (including first and second mortgages and home equity loans) (mortgage(s) can be on personal residence, any additional residence, or property held for investment or used in a trade or business) $ 750,000 3. Can ie file 2012 taxes now Car and other vehicle loans $ 4. Can ie file 2012 taxes now Medical bills owed $ 5. Can ie file 2012 taxes now Student loans $ 6. Can ie file 2012 taxes now Accrued or past-due mortgage interest $ 7. Can ie file 2012 taxes now Accrued or past-due real estate taxes $ 8. Can ie file 2012 taxes now Accrued or past-due utilities (water, gas, electric) $ 9. Can ie file 2012 taxes now Accrued or past-due child care costs $ 10. Can ie file 2012 taxes now Federal or state income taxes remaining due (for prior tax years) $ 11. Can ie file 2012 taxes now Judgments $ 12. Can ie file 2012 taxes now Business debts (including those owed as a sole proprietor or partner) $ 13. Can ie file 2012 taxes now Margin debt on stocks and other debt to purchase or secured by investment assets other than real property $ 14. Can ie file 2012 taxes now Other liabilities (debts) not included above $ 15. Can ie file 2012 taxes now Total liabilities immediately before the cancellation. Can ie file 2012 taxes now Add lines 1 through 14. Can ie file 2012 taxes now $ 768,000 Part II. Can ie file 2012 taxes now Fair market value (FMV) of assets owned immediately before the cancellation (do not include the FMV of the same asset in more than one category) Assets FMV Immediately Before  the Cancellation 16. Can ie file 2012 taxes now Cash and bank account balances $ 15,000 17. Can ie file 2012 taxes now Real property, including the value of land (can be main home, any additional home, or property held for investment or used in a trade or business) $ 18. Can ie file 2012 taxes now Cars and other vehicles $ 10,000 19. Can ie file 2012 taxes now Computers $ 20. Can ie file 2012 taxes now Household goods and furnishings (for example, appliances, electronics, furniture, etc. Can ie file 2012 taxes now ) $ 17,000 21. Can ie file 2012 taxes now Tools $ 22. Can ie file 2012 taxes now Jewelry $ 23. Can ie file 2012 taxes now Clothing $ 24. Can ie file 2012 taxes now Books $ 25. Can ie file 2012 taxes now Stocks and bonds $ 26. Can ie file 2012 taxes now Investments in coins, stamps, paintings, or other collectibles $ 27. Can ie file 2012 taxes now Firearms, sports, photographic, and other hobby equipment $ 28. Can ie file 2012 taxes now Interest in retirement accounts (IRA accounts, 401(k) accounts, and other retirement accounts) $ 29. Can ie file 2012 taxes now Interest in a pension plan $ 30. Can ie file 2012 taxes now Interest in education accounts $ 31. Can ie file 2012 taxes now Cash value of life insurance $ 32. Can ie file 2012 taxes now Security deposits with landlords, utilities, and others $ 33. Can ie file 2012 taxes now Interests in partnerships $ 34. Can ie file 2012 taxes now Value of investment in a business $ 35. Can ie file 2012 taxes now Other investments (for example, annuity contracts, guaranteed investment contracts, mutual funds, commodity accounts, interests in hedge funds, and options) $ 36. Can ie file 2012 taxes now Other assets not included above $ 37. Can ie file 2012 taxes now FMV of total assets immediately before the cancellation. Can ie file 2012 taxes now Add lines 16 through 36. Can ie file 2012 taxes now $ 42,000 Part III. Can ie file 2012 taxes now Insolvency 38. Can ie file 2012 taxes now Amount of Insolvency. Can ie file 2012 taxes now Subtract line 37 from line 15. Can ie file 2012 taxes now If zero or less, you are not insolvent. Can ie file 2012 taxes now $ 726,000    Frank and Kathy's Form 982 This image is too large to be displayed in the current screen. Can ie file 2012 taxes now Please click the link to view the image. Can ie file 2012 taxes now Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment) Prev  Up  Next   Home   More Online Publications
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Tax Return Preparer Fraud
FS-2008-10, January 2008 — Get hints from IRS on how to choose a reputable tax preparer.

Fraudulent Telephone Tax Refunds, Abusive Roth IRAs Top Off 2007 “Dirty Dozen” Tax Scams
IR-2007-37, Feb. 20, 2007 –– Also new to the "Dirty Dozen" are abuses involving the American Indian Employment Credit, domestic shell companies and structured entities.

IRS Moves to Prevent Telephone Tax Refund Abuse; Help Taxpayers Make Accurate Requests
IR-2007-27, Feb. 7, 2007 — The Internal Revenue Service announced today it is taking additional steps to prevent abuse by tax preparers and help taxpayers make accurate requests for the one-time telephone excise tax refund.

Statement of IRS Commissioner Mark W. Everson on the FY 2008 Budget
Feb. 5, 2007 — The president’s 2008 budget request for the IRS, together with the accompanying legislative proposals concerning tax administration... will do much to promote compliance with our tax law.

Tax Return Preparer Fraud
FS-2007-12, January 2007 — Taxpayers should use caution when engaging professional tax return preparers and learn the warning signs of potential fraud.

IRS Accepts Settlement Offer in Largest Transfer Pricing Dispute
IR-2006-142, Sept. 11, 2006 — IRS has reached a satisfactory settlement in a transfer pricing dispute with Glaxo SmithKline in the largest tax dispute in the IRS's history.

IRS and States Join Forces to Combat Money Laundering
IR-2006-70, April 27, 2006 — Thirty-three states and Puerto Rico have signed agreements with the IRS to share Bank Secrecy Act information on money services businesses.

IRS Debunks Frivolous Arguments on Paying Taxes
IR-2006-45, March 16, 2006 — The IRS today issued updated guidance describing and rebutting frivolous arguments taxpayers should avoid when filing their tax returns

IRS Updates Tax Gap Estimates
IR-2006-28, Feb. 14, 2006 — The revised tax gap estimate is $345 billion for tax year 2001. The tax gap is the difference between what taxpayers timely and voluntarily should have paid and what they did pay.

IRS Improves Enforcement and Services in 2005
Prepared remarks by IRS Commissioner Mark W. Everson reqarding new Fiscal Year 2005 data that show improvements in enforcement and services to taxpayers.

IRS Launches Abusive Transaction Settlement Initiative
IR-2005-129, Oct. 27, 2005 — Internal Revenue Service officials today announced a broad-based, limited-in-time opportunity for taxpayers to come forward and settle an array of transactions the IRS considers abusive.

KPMG to Pay $456 Million for Criminal Violations
IR-2005-83, Aug. 29, 2005 — KPMG LLP (KPMG) has admitted to criminal wrongdoing and agreed to pay $456 million in fines, restitution and penalties as part of an agreement to defer prosecution of the firm, the Justice Department and the Internal Revenue Service announced today.

Robust Response for Executive Stock Option Initiative; Son of Boss Settlement Heading for $4 Billion
IR-2005-72, July 11, 2005 — IRS officials announced today that they received a strong turnout for the executive stock option settlement initiative launched in February.

IRS Collects $3.2 Billion from Son of Boss; Final Figure Should Top $3.5 Billion
IR-2005-37 — Abusive transaction aggressively marketed to wealthy individuals. Settlement required taxpayers to concede 100 percent of claimed tax losses.

IRS Obtains More Than 100 Injunctions Against Tax Scheme Promoters
FS-2005-15 — Many of the injunctions order promoters to turn over client lists and to cease preparing federal income tax returns for others.

States See Son of Boss Benefits; Tax Administrators Praise Efforts
FS-2005-13 –– States are beginning to see results from the IRS Son of Boss settlement initiative. California and New York have also conducted compliance initiatives.

Understanding the Tax Gap
FS-2005-14 — The tax gap measures the extent to which taxpayers do not file their tax returns and pay the correct tax on time.

Report on IRS Review of Alleged Political Campaign Intervention 2005
The Treasury Inspector General reports that IRS properly ran its program for investigating claims of inappropriate political campaign actions by tax-exempt organizations.

Page Last Reviewed or Updated: 28-Mar-2014

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