TNVIPER said:
You need a competent tax advisor........This is what I do and I cant advise you because I do not know all the facts but I will say that if your tax advisor knows what he is doing you probably will not owe any taxes on the loan forgiveness...There are different approaches to this..
Hi Larry, this is Wifey...
I talked to a CPA briefly tonight after work, he said in a nutshell that if you are insolvent at the time you get the debt releif then you wouldn't be taxed. He said to take all assets (including beneficial interest in jerry's parent's estate that isn't distributed yet) and take all the liabilities and if the liabilities are more than the assets we would be ok. It would probably take about $28k or so to reinstate the first, pay off the settlement offered by the second and pay the balance due on the lease we are in until next March.
I told him I would have to figure out a way to borrow the money and he said that would create even more of a liability because the borrowed money would be incurred before it was paid out on the settlement.
He also said if they are offering to settle for $15,000, he would offer them less. They are probably only offering any kind of settlement amount because they know when it goes to sale next month they will get ZIPPPPP out of it.
If I can find someone to loan the money, once the settlement is paid to the second, that would leave some equity in the house and whoever I borrow it from could then become a new secured second.
Why in the hell do they wait until people are this far into a mess before they offer any kind of help? The first said I should download a modification application and get it to them asap. Right before the sale date I can call them and if they are still reviewing it, they could (not would, but could) postpone the sale date.
Anyway, thanks for reading and if anyone has any ideas or suggestions, we are open ...... We thought if we could end up my the grace of God salvaging this place, we could rent it out and go from there ....