We hosted a short sale and foreclosure panel discussion yesterday. The panel members included Scott Drucker, a short sale/real-estate solicitor from Mack, Drucker and Watson, Eric Viavattene, a wickedly smart CPA from Dobbins Fiscal and Gerry Russell, the managing broker with Realty Middle management Phoenix. Once again we were reminded how important it is to find BOTH legal and tax advice when thinking about a short sale or foreclosure in Phoenix, AZ. Yes, we did the bold face thing. We really do mean this.
There's much bafflement about the legal and tax implications of either a short sale or foreclosure. We've taken well over 100 hours of continuing education and specialty conventions covering short sales/foreclosure and each time we leave more informed, yet daunted by the complexities involved. The key area of confusion is the most important difference between the legal and tax consequences. It is simply like night and day.
Just so you know, we aren't going to try to explain the differences between the legal side and tax/IRS during a short sale or foreclosure in this article.. There are simply too many variables to cover, and we aren't lawyers or tax executives. That said , below are a few things both Eric and Scott discussed in the discussion we wish to pass on.
Short sales frequently offer more protection to the homeowner than a foreclosure. This isn't an absolute though and will be explored by consulting both a tax and legal pro.
The Arizona Anti-Deficiency laws don't always protect a home owner from IRS liabilities during a short sale or foreclosure. The anti-deficiency laws offer legal protection in explicit circumstances, yet may not guard against an IRS obligation.
Bankruptcy is an IRS protection mechanism some may benefit using with a short sale or foreclosure. However , you have to create a extremely robust and proper paper trail.
If going into foreclosure, many will benefit by having an appraisal performed prior to the trustee sale.
If you're considering insolvency along with a foreclosure or short sale, make sure and work with a great insolvency lawyer and tax pro prior to doing anything. If you do things in the wrong order you might find yourself in jeopardy.
If you've done a short sale and received a 1099 from the bank, don't ignore it. Look for a qualified tax professional to insure it is reported correctly to the IRS.
This is simply a short list of many items that came up in the 1.5 hour panel discourse. The bottom line reminder to us as Realtors is simple: Strongly counsel our clients to seek pro counsel. This has always been our policy, yet it is good to be reminded.
You may be asking yourself how much consultation cost. We cannot talk for all lawyers and tax executives, yet Scott and Eric shared their charges with us.
Mack, Drucker and Watson will sit with you, go over your current position and offer options for only $250.00. The folds at Dobbins Finance will check your situation and offer guidance for $195.00. Thus, for under $500.00 you may be well informed BEFORE reaching a decision. To us that is cheap insurance.
AN IMPORTANT NOTE: Quality information is the results of good info. Ensure you gather any and all loan documents and finance reports before meeting with your legal and tax counsel. We've read about folks who didn't remember to mention they'd refinanced their home or taken money out in a home equity line and found themselves in appalling straights later on.
CONCLUSIONS ABOUT Looking for LEGAL AND TAX Advice Prior To A SHORT SALE OR FORECLOUSRE:
There is simply no way most house owners can proceed with a short sale or foreclosure on there own. The IRS tax code is miles long and the legal side of the equation is a moving target based mostly on new rulings and changing laws. Your long term safely and contentment is worth a couple of hundred $.
There's much bafflement about the legal and tax implications of either a short sale or foreclosure. We've taken well over 100 hours of continuing education and specialty conventions covering short sales/foreclosure and each time we leave more informed, yet daunted by the complexities involved. The key area of confusion is the most important difference between the legal and tax consequences. It is simply like night and day.
Just so you know, we aren't going to try to explain the differences between the legal side and tax/IRS during a short sale or foreclosure in this article.. There are simply too many variables to cover, and we aren't lawyers or tax executives. That said , below are a few things both Eric and Scott discussed in the discussion we wish to pass on.
Short sales frequently offer more protection to the homeowner than a foreclosure. This isn't an absolute though and will be explored by consulting both a tax and legal pro.
The Arizona Anti-Deficiency laws don't always protect a home owner from IRS liabilities during a short sale or foreclosure. The anti-deficiency laws offer legal protection in explicit circumstances, yet may not guard against an IRS obligation.
Bankruptcy is an IRS protection mechanism some may benefit using with a short sale or foreclosure. However , you have to create a extremely robust and proper paper trail.
If going into foreclosure, many will benefit by having an appraisal performed prior to the trustee sale.
If you're considering insolvency along with a foreclosure or short sale, make sure and work with a great insolvency lawyer and tax pro prior to doing anything. If you do things in the wrong order you might find yourself in jeopardy.
If you've done a short sale and received a 1099 from the bank, don't ignore it. Look for a qualified tax professional to insure it is reported correctly to the IRS.
This is simply a short list of many items that came up in the 1.5 hour panel discourse. The bottom line reminder to us as Realtors is simple: Strongly counsel our clients to seek pro counsel. This has always been our policy, yet it is good to be reminded.
You may be asking yourself how much consultation cost. We cannot talk for all lawyers and tax executives, yet Scott and Eric shared their charges with us.
Mack, Drucker and Watson will sit with you, go over your current position and offer options for only $250.00. The folds at Dobbins Finance will check your situation and offer guidance for $195.00. Thus, for under $500.00 you may be well informed BEFORE reaching a decision. To us that is cheap insurance.
AN IMPORTANT NOTE: Quality information is the results of good info. Ensure you gather any and all loan documents and finance reports before meeting with your legal and tax counsel. We've read about folks who didn't remember to mention they'd refinanced their home or taken money out in a home equity line and found themselves in appalling straights later on.
CONCLUSIONS ABOUT Looking for LEGAL AND TAX Advice Prior To A SHORT SALE OR FORECLOUSRE:
There is simply no way most house owners can proceed with a short sale or foreclosure on there own. The IRS tax code is miles long and the legal side of the equation is a moving target based mostly on new rulings and changing laws. Your long term safely and contentment is worth a couple of hundred $.
About the Author:
Phoenix Short Sales Specialist makes a speciality of Short Sales in the Phoenix AZ metro areas. Reasons for short sales include minimal credit damage, ability to obtain a future mortgage, work factors, avoiding foreclosure and low taxation burden. We can help you with your Short Sale today!Phoenix Short Sales Specialist 2 N Central Ave 720
Phoenix, AZ 85004
(480) 648-4929
Phoenix, AZ 85004
(480) 648-4929
0 comments:
Post a Comment