Did you know that cancelled debt is taxable income?

[RCA]

I thought I had seen it all until I saw this:

http://en.wikipedia.org/wiki/Cancellation_of_Debt_%28COD%29_Income

[Anti Federalist]

I thought I had seen it all until I saw this:

http://en.wikipedia.org/wiki/Cancellation_of_Debt_%28COD%29_Income

Where the hell have you been, Mundane?!

There was temporary relief enacted for homeowners that got foreclosed on living in upside down houses.

I think that relief has expired.

[RCA]

I thought income tax charged for interest paid by the IRS was sick enough, but this concept out does it. It taxes NOTHING.

[ctiger2]

Where the hell have you been, Mundane?!

There was temporary relief enacted for homeowners that got foreclosed on living in upside down houses.

I think that relief has expired.


The Mortgage Forgiveness Debt Relief Act and Debt Cancellation


If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount may be taxable.

The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.

This provision applies to debt forgiven in calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion ($1 million if married filing separately). The exclusion does not apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home’s value or the taxpayer’s financial condition.

http://www.irs.gov/individuals/article/0,,id=179414,00.html

If you're gonna walk, walk before the end of '12.

[VBRonPaulFan]

yeah, they consider it a windfall in your favor. you're suddenly X amount of dollars richer because you no longer owe that cash. the tax code is getting insanely intrusive and is only going to get worse.

[RCA]

The lottery is a windfall. Cancelled debt MAY be an invisible windfall at best.

[Anti Federalist]

Now you why the only people that Jesus ever used violence against were the banskters of his day.

[MozoVote]

It's not all bad. When tenants trash your property, you can total up the bill for repairs, and get a judgement. Since there's fat chance of ever getting ex-tenants to pay up, you can forgive the debt and file a 1099 on their ass. Buh-bye, IRS refund!

This also works on deadbeat child support. If you cannot collect, share your pain.

[RCA]

Now you why the only people that Jesus ever used violence against were the banskters of his day.

http://www.tatepublishing.com/bookstore/book.php?w=978-1-61739-164-4

[Johncjackson]

Yeah, I settled some credit cards 7 or 8 years ago and got 1099s.

[Warrior_of_Freedom]

oh please, don't get me started. I don't qualify for a grant for college because they think making 100 dollars a week part time is sufficient

[libertarian4321]

oh please, don't get me started. I don't qualify for a grant for college because they think making 100 dollars a week part time is sufficient

As an American tax payer, let me be the first to say GOOD!

Government grants for college are just another waste of our money.

If you want to go to college, find a way to pay for it that doesn't involve a free gift (grant) from the US taxpayer.

[Warrior_of_Freedom]

As an American tax payer, let me be the first to say GOOD!

Government grants for college are just another waste of our money.

If you want to go to college, find a way to pay for it that doesn't involve a free gift (grant) from the US taxpayer.

Oh please, at least I pay for most of it. The kids who are in complete debt from going to college are way more of a heavier burden than someone receiving a 1.5k grant to help offset the huge cost of tuition. I'm doing it to become a productive member of society. It's not foodstamps. Besides, that doesn't even make up for 10% of the taxes my family pays anyway. Most likely my tuition (it's a state college) helps pay for some grants and scholarships. College for me is full time in itself. For my major each class is 6 hours long, so taking 6 classes means I'm at school for at least 36 hours a week. So basically you're saying I'm a waste of money. And besides, you don't pay my state tax, so bog off.

[Imaginos]

Now you why the only people that Jesus ever used violence against were the banskters of his day.
qft.
Jesus was a kind hearted man with many benevolent character traits.
However Jesus crushed and slaughtered (verbally, of course) banksters in his time.
I read the entire Bible when I was a teenager chairman in a local church and as far as I remember, Jesus did take no prisoners when he confronted them.
I bet if Jesus was alive today, he would beat the crap out of (verbally) his majesty Bernanke and his fellow overlord banksters.

[Johncjackson]

Oh please, at least I pay for most of it. The kids who are in complete debt from going to college are way more of a heavier burden than someone receiving a 1.5k grant to help offset the huge cost of tuition. I'm doing it to become a productive member of society. It's not foodstamps. Besides, that doesn't even make up for 10% of the taxes my family pays anyway. Most likely my tuition (it's a state college) helps pay for some grants and scholarships. College for me is full time in itself. For my major each class is 6 hours long, so taking 6 classes means I'm at school for at least 36 hours a week. So basically you're saying I'm a waste of money. And besides, you don't pay my state tax, so bog off.

I'm on your side here. While I might agree somewhat with the other comment that taxpayer grants for college are a waste of money, that really does nothing to address the problems of why tuition is inflated, why it still IS pretty much necessary for most ( not all) people to have at least a BA/BS to get by,etc. There are a lot of problems with the college industry, but I think without assistance in the absence of some real solution it only stacks the deck against those who most need/benefit from it.

[Zippyjuan]

They consider the debt forgiveness the same as if someone actually gave you the money to pay it and you used that money to pay the debt.