Home sale

[Rescue409]

• Me and my ex husband had a house. He lives in it for 2 years after I left. We were in foreclosure and had a short sale on house in 2019. I got a 1099s split between both of us and a mortgage interest in 2019 in both our names. In 2020 I was made responsible for loan due to me getting ssdi and ex husband getting ssi they could not touch him financially. I was able to get all of the amount put on me forgiven. This year I received a 1099c for an ungodly amount for the amount forgiven and it is only in my name. Now I am running into issues with irs and why is the form just in my name and not split between me and the ex husband. We were suppose to split all responsibilities equally but it had all been placed on me.   I did not file taxes in 2019 because I was not working. How do I handle the situation?

[AmyC]

Since the 2019 house was a main home, it would not be taxable but receipt of the 1099-S makes it reportable. You should file a 2019 return to report the sale and that it is not taxable. Here is a link for  how to prepare prior year returns.

For 2021, the 1099-C needs to be reported. For details on taxable income, see Topic No. 431 Canceled Debt – Is It Taxable or Not? 

• The borrower is the debtor and includes the income.
• It seems that you and your ex were both responsible for the debt. You need to verify that you did not sign anything to take full responsibility for the debt.
• Contact the issuer of the form and ask them for a corrected form showing only your portion of the debt. 
• If they will not, you will need to mail in your tax return with a note explaining that only half of the debt is yours.