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Has anyone used Taxcut or Turbo Tax to deal with the debt cancellation on your short sale? 1099C and

Discussion in 'Short Sale Outpost' started by cahomeowner, Apr 2, 2011.

  1. cahomeowner

    cahomeowner LoanSafe Member

    I have been doing my own taxes for the past 10 years. I completed a couple of short sales last year and I want to claim insolvency (Form 982) to deal with the debt cancellation of the 1099-C's that were issued from the banks. I understand this is a complex area but the CPA's and Tax firms in my area want to charge 700-1000 which I don't have to spend.

    I was wondering if anyone used turbotax or taxcut to file their own returns? did the program deal with short sales, foreclosures etc in the interview process? any issues?
  2. TomEason

    TomEason LoanSafe Guide Staff Member

    I am a long time user of TurboTax and have been doing my own tax returns for many years. I use TTax in the forms mode, i.e. I tell the software what to put on the forms. I've found that by doing so I am able to take advantage of certain deductions and legal loopholes that TTax would miss. I also get the current year copy of JK Lasser's Your Income Tax, only $12 at Amazon, to use as a reference. It's much better than the IRS publications. To answer your question, I suggest you read the applicable IRC reg (if not JK Lasser) and learn the stuff. If not enough time, then the $700 - $1,000 to your tax professional may be worth it.
  3. cahomeowner

    cahomeowner LoanSafe Member

    Thanks Tom

    Like to hear from those that did use a CPA and figure out if the questions the CPA asked in regards to dealing with the deficiency were anything out of the ordinary? how was the deficiency handled and were you able to prove insolvency and deduct 100% of the deficiency or only a portion?

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