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Loan modification

Discussion in 'Stocks & Investments' started by boxxed, Aug 27, 2013.

  1. Aug 27, 2013 at 8:03 AM
    #1
    boxxed

    boxxed [OP] Well-Known Member

    Joined:
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    Denver, CO
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    Does anyone know if there are tax consequences with getting a loan modification?
    My lender agreed to reduce the unpaid principal amount and forgiving the deficiency.
    I was reading this and several other sites:
    http://www.irs.gov/Individuals/The-Mortgage-Forgiveness-Debt-Relief-Act-and-Debt-Cancellation

    Under the "Is Cancellation of Debt income always taxable?" there is exceptions to being taxed.
    In my case I did file bankruptcy and included my mortgage and it was discharged.
    Being that I now agreed to a loan modification do you think it opens me up to having the pay taxes on the deficiency?
    I am not exactly sure how that is going to work.


    Thanks


    Guess I found my own answer. It looks like it got extended till the end of 2013.. http://ceb.com/lawalerts/mfdr.asp
     
    Last edited: Aug 27, 2013

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