Remember, we are not tax preparers or CPAs. Every tax situation is different and we highly recommend you seek a qualified professional to advise you. This is not a comprehensive list but rather a collection of a few IRS resources to help better understand this complex issue:

• How do I report the debt forgiven on my residence due to foreclosure, repossession, abandonment, or because of a loan modification or short sale?
• Topic no. 431, Canceled debt – Is it taxable or not?
• IRS Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments (For Individuals)
• IRS Form 982
• Instructions for Form 982 (12/2021) Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment) (For use with Form 982 (Rev. March 2018))