Monday, August 27, 2012

Clock is ticking!! The Mortgage Forgiveness Debt Relief Act and Debt Cancellation is near

Here is a great article for you to read if you are considering selling our home but have been or are about to be short to make your mortgage payment...
what happen then?
Read below the info right form the IRS website.
If you still have question, call, text or email me! I'm glad to help you confidentially!
Angélique Kenney | Realtor® for Professional AthletesCRSGRIe-ProSFRILHM member, SSR 

+1.760.282.4663 (Last 4 Spells "HOME")

The Mortgage Forgiveness Debt Relief Act and Debt Cancellation

 
If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount may be taxable.

The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.

This provision applies to debt forgiven in calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion ($1 million if married filing separately). The exclusion does not apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home’s value or the taxpayer’s financial condition.

More information, including detailed examples can be found in Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments. Also see IRS news release IR-2008-17.

The following are the most commonly asked questions and answers about The Mortgage Forgiveness Debt Relief Act and debt cancellation:

What is Cancellation of Debt?
If you borrow money from a commercial lender and the lender later cancels or forgives the debt, you may have to include the cancelled amount in income for tax purposes, depending on the circumstances. When you borrowed the money you were not required to include the loan proceeds in income because you had an obligation to repay the lender. When that obligation is subsequently forgiven, the amount you received as loan proceeds is normally reportable as income because you no longer have an obligation to repay the lender. The lender is usually required to report the amount of the canceled debt to you and the IRS on a Form 1099-C, Cancellation of Debt.

Here’s a very simplified example. You borrow $10,000 and default on the loan after paying back $2,000. If the lender is unable to collect the remaining debt from you, there is a cancellation of debt of $8,000, which generally is taxable income to you.

Is Cancellation of Debt income always taxable?Not always. There are some exceptions. The most common situations when cancellation of debt income is not taxable involve:
  • Qualified principal residence indebtedness: This is the exception created by the Mortgage Debt Relief Act of 2007 and applies to most homeowners.
  • Bankruptcy: Debts discharged through bankruptcy are not considered taxable income.
  • Insolvency: If you are insolvent when the debt is cancelled, some or all of the cancelled debt may not be taxable to you. You are insolvent when your total debts are more than the fair market value of your total assets.
  • Certain farm debts: If you incurred the debt directly in operation of a farm, more than half your income from the prior three years was from farming, and the loan was owed to a person or agency regularly engaged in lending, your cancelled debt is generally not considered taxable income.
  • Non-recourse loans: A non-recourse loan is a loan for which the lender’s only remedy in case of default is to repossess the property being financed or used as collateral. That is, the lender cannot pursue you personally in case of default. Forgiveness of a non-recourse loan resulting from a foreclosure does not result in cancellation of debt income. However, it may result in other tax consequences.
These exceptions are discussed in detail in Publication 4681.

What is the Mortgage Forgiveness Debt Relief Act of 2007?
The Mortgage Forgiveness Debt Relief Act of 2007 was enacted on December 20, 2007 (see News Release IR-2008-17). Generally, the Act allows exclusion of income realized as a result of modification of the terms of the mortgage, or foreclosure on your principal residence.

What does exclusion of income mean?Normally, debt that is forgiven or cancelled by a lender must be included as income on your tax return and is taxable. But the Mortgage Forgiveness Debt Relief Act allows you to exclude certain cancelled debt on your principal residence from income. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.

Does the Mortgage Forgiveness Debt Relief Act apply to all forgiven or cancelled debts?No. The Act applies only to forgiven or cancelled debt used to buy, build or substantially improve your principal residence, or to refinance debt incurred for those purposes. In addition, the debt must be secured by the home. This is known as qualified principal residence indebtedness. The maximum amount you can treat as qualified principal residence indebtedness is $2 million or $1 million if married filing
separately.

Does the Mortgage Forgiveness Debt Relief Act apply to debt incurred to refinance a home?
Debt used to refinance your home qualifies for this exclusion, but only to the extent that the principal balance of the old mortgage, immediately before the refinancing, would have qualified. For more information, including an example, see Publication 4681.

How long is this special relief in effect?It applies to qualified principal residence indebtedness forgiven in calendar years 2007 through 2012.

Is there a limit on the amount of forgiven qualified principal residence indebtedness that can be excluded from income?The maximum amount you can treat as qualified principal residence indebtedness is $2 million ($1 million if married filing separately for the tax year), at the time the loan was forgiven. If the balance was greater, see the instructions to Form 982 and the detailed example in Publication 4681.

If the forgiven debt is excluded from income, do I have to report it on my tax return?Yes. The amount of debt forgiven must be reported on Form 982 and this form must be attached to your tax return.

Do I have to complete the entire Form 982?No. Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Adjustment), is used for other purposes in addition to reporting the exclusion of forgiveness of qualified principal residence indebtedness. If you are using the form only to report the exclusion of forgiveness of qualified principal residence indebtedness as the result of foreclosure on your principal residence, you only need to complete lines 1e and 2. If you kept ownership of your home and modification of the terms of your mortgage resulted in the forgiveness of qualified principal residence indebtedness, complete lines 1e, 2, and 10b. Attach the Form 982 to your tax return.

Where can I get this form?If you use a computer to fill out your return, check your tax-preparation software. You can also download the form at IRS.gov, or call 1-800-829-3676. If you call to order, please allow 7-10 days for delivery.

How do I know or find out how much debt was forgiven?Your lender should send a Form 1099-C, Cancellation of Debt, by February 2, 2009. The amount of debt forgiven or cancelled will be shown in box 2. If this debt is all qualified principal residence indebtedness, the amount shown in box 2 will generally be the amount that you enter on lines 2 and 10b, if applicable, on Form 982.

Can I exclude debt forgiven on my second home, credit card or car loans?Not under this provision. Only cancelled debt used to buy, build or improve your principal residence or refinance debt incurred for those purposes qualifies for this exclusion. See Publication 4681 for further details.

If part of the forgiven debt doesn't qualify for exclusion from income under this provision, is it possible that it may qualify for exclusion under a different provision?Yes. The forgiven debt may qualify under the insolvency exclusion. Normally, you are not required to include forgiven debts in income to the extent that you are insolvent.  You are insolvent when your total liabilities exceed your total assets. The forgiven debt may also qualify for exclusion if the debt was discharged in a Title 11 bankruptcy proceeding or if the debt is qualified farm indebtedness or qualified real property business indebtedness. If you believe you qualify for any of these exceptions, see the instructions for Form 982. Publication 4681 discusses each of these exceptions and includes examples.

I lost money on the foreclosure of my home. Can I claim a loss on my tax return?No.  Losses from the sale or foreclosure of personal property are not deductible.

If I sold my home at a loss and the remaining loan is forgiven, does this constitute a cancellation of debt?Yes. To the extent that a loan from a lender is not fully satisfied and a lender cancels the unsatisfied debt, you have cancellation of indebtedness income. If the amount forgiven or canceled is $600 or more, the lender must generally issue Form 1099-C, Cancellation of Debt, showing the amount of debt canceled. However, you may be able to exclude part or all of this income if the debt was qualified principal residence indebtedness, you were insolvent immediately before the discharge, or if the debt was canceled in a title 11 bankruptcy case.  An exclusion is also available for the cancellation of certain nonbusiness debts of a qualified individual as a result of a disaster in a Midwestern disaster area.  See Form 982 for details.

If the remaining balance owed on my mortgage loan that I was personally liable for was canceled after my foreclosure, may I still exclude the canceled debt from income under the qualified principal residence exclusion, even though I no longer own my residence? 
Yes, as long as the canceled debt was qualified principal residence indebtedness. See Example 2 on page 13 of Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments.

Will I receive notification of cancellation of debt from my lender?
Yes. Lenders are required to send Form 1099-C, Cancellation of Debt, when they cancel any debt of $600 or more. The amount cancelled will be in box 2 of the form.

What if I disagree with the amount in box 2?Contact your lender to work out any discrepancies and have the lender issue a corrected Form 1099-C.

How do I report the forgiveness of debt that is excluded from gross income?(1) Check the appropriate box under line 1 on Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment) to indicate the type of discharge of indebtedness and enter the amount of the discharged debt excluded from gross income on line 2.  Any remaining canceled debt must be included as income on your tax return.

(2) File Form 982 with your tax return.

My student loan was cancelled; will this result in taxable income?In some cases, yes. Your student loan cancellation will not result in taxable income if you agreed to a loan provision requiring you to work in a certain profession for a specified period of time, and you fulfilled this obligation.

Are there other conditions I should know about to exclude the cancellation of student debt?Yes, your student loan must have been made by:
(a) the federal government, or a state or local government or subdivision;

(b) a tax-exempt public benefit corporation which has control of a state, county or municipal hospital where the employees are considered public employees; or

(c) a school which has a program to encourage students to work in underserved occupations or areas, and has an agreement with one of the above to fund the program, under the direction of a governmental unit or a charitable or educational organization.
Can I exclude cancellation of credit card debt?In some cases, yes. Nonbusiness credit card debt cancellation can be excluded from income if the cancellation occurred in a title 11 bankruptcy case, or to the extent you were insolvent just before the cancellation. See the examples in Publication 4681.

How do I know if I was insolvent?You are insolvent when your total debts exceed the total fair market value of all of your assets.  Assets include everything you own, e.g., your car, house, condominium, furniture, life insurance policies, stocks, other investments, or your pension and other retirement accounts.

How should I report the information and items needed to prove insolvency?Use Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment) to exclude canceled debt from income to the extent you were insolvent immediately before the cancellation.  You were insolvent to the extent that your liabilities exceeded the fair market value of your assets immediately before the cancellation.

To claim this exclusion, you must attach Form 982 to your federal income tax return.  Check box 1b on Form 982, and, on line 2, include the smaller of the amount of the debt canceled or the amount by which you were insolvent immediately prior to the cancellation.  You must also reduce your tax attributes in Part II of Form 982.

My car was repossessed and I received a 1099-C; can I exclude this amount on my tax return?Only if the cancellation happened in a title 11 bankruptcy case, or to the extent you were insolvent just before the cancellation. See Publication 4681 for examples.

Are there any publications I can read for more information?
Yes.
(1) Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments (for Individuals) is new and addresses in a single document the tax consequences of cancellation of debt issues.

(2) See the IRS news release IR-2008-17 with additional questions and answers on IRS.gov.
 


Page Last Reviewed or Updated: January 24, 2012

Wednesday, August 22, 2012

First Android-Powered Camera - The right marriage?


Ok, you got me! I'm not just a real estate agent but a total geek at times!

Yes my real estate updates about the North county and San Diego homes is fabulous, smart and reflect the truth about the market and I go to admit that what people want to read is "when is the next iPhone 5 coming out" or "Newest Android phone" "Best app to download to be more productive", and all. I get it, so now here you go, whatever I search online besides the best deals for sale on the market in Carlsbad or coastal San Diego cities will be displayed on my blog. 

Kinda like me, a complex blend of nerdyness (if this words exist), brain and beauty...I'm talking about my blog and my business, but I appreciate the smile on your face that means that you also agree. 

So here is one of the newest thing I stumbled across in a blog online from this supercool site:  http://www.petapixel.com

As always, Enjoy! 

Angélique Kenney | Realtor® for Professional AthletesCRSGRIe-ProSFRILHM member, SSR 

+1.760.282.4663 (Last 4 Spells "HOME")

Nikon Unveils the Coolpix S800c, Its First Android-Powered Camera

Nikon Unveils the Coolpix S800c, Its First Android Powered Camera 800c1 mini
After weeks of rumors and leaked photos, Nikon has finally officially announced its new Coolpix S800c compact camera — the company’s first camera to be powered by Android OS. It’s designed to be a powerful point-and-shoot that offers the versatility of app-based mobile phones.

On the photo side of things, the camera features a 16-megapixel CMOS sensor and a 10x Nikkor VR-equipped zoom lens (25-250mm in 35mm terms).
Other features include 8fps burst mode, creative filters built into the camera, 1080p HD video recording with full stereo sound, built in GPS, and a 3.5-inch OLED touchscreen.
Nikon Unveils the Coolpix S800c, Its First Android Powered Camera 800c2 mini
The combo of Android OS and built-in Wi-Fi is what makes this camera truly stand out in the Nikon point-and-shoot lineup. It means you can download and use apps, surf the web, instantly share photos through social networking and photo sharing sites, play Angry Birds, and check your email — all from the comfort of your compact camera.
From the back, the camera looks just like an Android-powered phone:
Nikon Unveils the Coolpix S800c, Its First Android Powered Camera 800c3 mini
Now that phones are becoming more and more like compact cameras, it seems like camera makers want to give phone makers a taste of their own medicine. If phones can feature large sensors, then cameras can feature the same operating systems used by phones!
Nikon Unveils the Coolpix S800c, Its First Android Powered Camera 800c4 mini
The camera will be available starting next month in white and black flavors. It’ll have a price tag of $350.

Monday, August 6, 2012

Fastest Ways to Stop Foreclosure and Sheriff Sale


Here is a mini series of articles I found online, to help people who are facing foreclosure and want to do a "short sale" which means: selling their home for less than what their loan amount is. Homeowners can have more than just 1 loan, they have 2sd, HELOC, 3sd...


Each banks I negotiate a short sale with is very different from one another. Each property and each individual I help with a short sale to prevent a foreclosure to happen is unique! Don't believe hear say stories...trust me this is what I do for a living, and all short sale may appear similar form a distance but each situation is unique and need different sets of documents, negotiations and what not.

I've seen it all, from relocation/job transfers, divorces, death of owner, people that voluntarily abandoned their property, trashed properties, immaculate properties to the wildest stories in the book! Either helping my client saving their situation via a short sale or helping home buyers purchasing a short sale property, for a successful transaction, you need:
1. A tenacious and well rounded/seasoned agent that don't give up easily the first time the bank hangs up the phone on him/her after hours trying or getting the run around...(like myself!)
2. Lot of patience, I'm not a miracle worker! But I do believe in miracle combined with hard work. Also,  I'm a real estate agent, NOT an attorney, NOT  a CPA but it helps to call them for questions and guidance.
3. Call your attorney, preferably a real estate attorney and call your CPA or tax preparer for any questions. Don't be ofended but I CANNOT answer those questions, I am only licensed to practice real estate and have no knowledge in law or tax. Most of them offers a free phone or in person consultation.

Give me a call and I will be all ears to help you 760.282.4663/760.282.HOME
Angelique Kenney

If you are looking to purchase and want to buy with a low amount of money down, read this article about FHA financinghttp://sdandochomes.blogspot.com/2012/06/how-much-can-i-afford-with-fha-loan-in.html
Still not sure? Read this article: buy or rent what's cheaper? http://sdandochomes.blogspot.com/2012/03/buy-or-rent-whats-cheaper.html

Look at the MLS (Multiple Listing System - aka: the Realtor's data base of homes) - FREE!
homes for sale in Carlsbad - click link

homes for sale in Encinitas - click link
homes for sale in San Marcos - click link

homes for sale in Vista - click link




ARTICLE #1:By 

Fastest Ways to Stop Foreclosure and Sheriff Sale

Homeowners in foreclosure, for one reason or another, often find that they have run out of time to stop foreclosure before they have run out of options that could save their homes. Often, this is due to one plan falling through at the last minute, or a simple inability of some foreclosure victims to make a decision on what to do to save their homes. By the time they have decided which option would work best for them, there is just not enough time to complete the method and actually prevent the foreclosure. When this happens, though, homeowners will often be scrambling around, looking for the most efficient way that they can put the foreclosure process on hold or stop the sheriff sale.
The fastest way to delay a foreclosure is to contact the bank as soon as the homeowners know they may begin missing payments. By keeping in touch with them throughout a financial hardship, the mortgage company will often be willing to postpone certain dates, like the initial foreclosure filing and the sheriff sale date. Obviously, this may not be applicable for homeowners who have avoided talking to the lender throughout the foreclosure process, but it is important to contact that bank as soon as possible. The lender will not always respond negatively, and they may be willing to work with the foreclosure victims to give more time or put together a solution to foreclosure. The important thing is to call the lender, though, and inform them of the situation and what is being done to avoid foreclosure.
Two dates that lenders are often willing to postpone are the sheriff sale date and the original foreclosure filing. The bank may be willing to hold off on filing the actual foreclosure paperwork, in order to give their clients more time to come up with the money to reinstate the loan, or become qualified for an affordable repayment plan or loan modification. Once the foreclosure is filed, though, interest is often accelerated and court costs and attorney fees are added into the balance of the loan, making it more difficult to qualify for a solution.
We have discussed stopping a sheriff sale in other articles and on our blog, so readers are referred to those entries, but lenders will often delay a sheriff sale if there is a reasonable solution being offered them. A thirty-day postponement is often all homeowners need to work out a long-term solution to foreclosure, and banks will be glad to avoid the foreclosure auction if there is a good chance they will get the mortgage paid off in other ways.
However, lenders are much more strict on the end of redemption, unfortunately. They do not like postponing this important foreclosure date, since they have waited such a long time to take the property back in the first place. If the homeowners have been in contact with them, though, they may be willing to provide more time to move out, postponing the actual eviction process for a few weeks. This may not help homeowners dramatically, and will not result in saving the house, but lenders do not want to forcefully evict former clients, either. Giving an extra couple of weeks to effect a peaceful transfer of the property and prevent damage is in the bank's best interests.
Unless the foreclosure victims need more than a few weeks, though, it may be a good idea to start looking for other places to live once the end of redemption comes close. Obviously, the mortgage company will not let them live in the house for a long time until their income recovers or they can qualify for a new mortgage, since the bank will want to get the property ready to sell to make back the money they lost on the loan they made that went into foreclosure.
Often, the fastest way to delay an important date in the foreclosure process is simply to keep the bank informed and ask for more time, based on the chances for success of the method being pursued to stop foreclosure. Gaining more time during the foreclosure process can be an easy procedure or it can be like pulling teeth, depending on how much communication there has been between the homeowners and the lender. As early in the financial hardship as is possible, foreclosure victims need to begin working with their banks to find solutions to foreclosure, and work on various options on their own, as well. Then, in the event a plan falls through at the last minute, the bank will much more willing to put a hold on things in order to give the homeowners, who have been working hard on finding solutions, more time to complete a plan and save their homes from foreclosure.
The ForeclosureFish.com website specializes in teaching homeowners exactly what they can do to stop foreclosure on their own. With hundreds of blog entries, articles, and reference materials on the site, foreclosure victims can put together a comprehensive plan to save their homes from foreclosure. Visit the ForeclosureFish.com website today to download a free foreclosure e-book and browse through material on various topics, such as loan modification and short sales: http://www.foreclosurefish.com/