http://shortsalesteps.com/warning-tax-consequences-for-short-selling-investment-properties Short Sale, Loan Modification & Foreclosure Specialist Wed, 05 Oct 2011 03:47:57 +0000 hourly 1 http://wordpress.org/?v=3.2.1 http://shortsalesteps.com/warning-tax-consequences-for-short-selling-investment-properties/comment-page-1#comment-114 Jennifer Wed, 20 Jul 2011 03:38:50 +0000 http://shortsalesteps.com/?p=56#comment-114 I called the IRS about this. They are very helpful and though you have to wait on hold for 10 or 20 minutes, you can always get through to someone who will tell you the correct answer to your question. I am short selling a rental property. I was told by the IRS representative, that I can deduct the loss from the rental property standpoint, as well as I must claim the forgiven debt as income. It does not quite cancel, in the sense that there is depreciation recapture as well. But in all, it doesn't work out as badly as you would think. When in doubt, call the IRS and ask them! I called the IRS about this. They are very helpful and though you have to wait on hold for 10 or 20 minutes, you can always get through to someone who will tell you the correct answer to your question. I am short selling a rental property. I was told by the IRS representative, that I can deduct the loss from the rental property standpoint, as well as I must claim the forgiven debt as income. It does not quite cancel, in the sense that there is depreciation recapture as well. But in all, it doesn’t work out as badly as you would think. When in doubt, call the IRS and ask them!

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