Home is personal residence; lived in for the past 11 years; approval from lender Jan 2017; cancelled debt is $115,895.
Under current law, the answer is yes because you entered into a contract in 2016.
Extension of the Mortgage Debt Relief Act
The Act initially covered a three-year period between 2007 and 2010, but was extended four times, to 2012, 2013, 2014 and then to 2016. This can also apply to debt that is discharged in 2017 provided that there was a written agreement entered into in 2016. How to Avoid Taxes on Canceled Mortgage Debt
To record this if you receive a 1099C or 1099A use these steps in TurboTax Deluxe in 2017:
- My Account > Topic Search > 1099c > Go
- Continue to enter your information
- Review the screenshots for clarity
If you enter this as a home sale, you should qualify for the home sale exclusion since you lived in the home more than two years. Retain your records for at least three years after the return is filed and accepted.
https://ttlc.intuit.com/replies/5404105
Under current law, the answer is yes because you entered into a contract in 2016.
Extension of the Mortgage Debt Relief Act
The Act initially covered a three-year period between 2007 and 2010, but was extended four times, to 2012, 2013, 2014 and then to 2016. This can also apply to debt that is discharged in 2017 provided that there was a written agreement entered into in 2016. How to Avoid Taxes on Canceled Mortgage Debt
To record this if you receive a 1099C or 1099A use these steps in TurboTax Deluxe in 2017:
- My Account > Topic Search > 1099c > Go
- Continue to enter your information
- Review the screenshots for clarity
If you enter this as a home sale, you should qualify for the home sale exclusion since you lived in the home more than two years. Retain your records for at least three years after the return is filed and accepted.
https://ttlc.intuit.com/replies/5404105