Cancelled Debt May be Considered Taxable Income by the IRS

Recieved this Blog from Realtor friend. If you are considering Shortsale, BK, Forclosure know your options  and how it will effect you in the future.


July 2012 Tax Newsletter



With the recent economic downturns experienced by many taxpayers, there is a tax concept that is very important: cancellation of debt. You would think that the cancellation of debt by a credit card company or mortgage company would be a good thing for the taxpayer. And it can be, but it can also be considered taxable income by the IRS. Here is a quick review of various debt cancellation situations.
* Consumer debt
If you have gone through some type of credit "workout" program on consumer debt, it's likely that some of your debt has been cancelled. If that is the case, be prepared to receive IRS Form 1099-C representing the amount of debt cancelled. The IRS considers that amount taxable income to you, and they expect to see it reported on your tax return. The exception is if you file for bankruptcy. With bankruptcy, generally the debt cancelled is not taxable.
Even if you are not legally bankrupt, you might be technically insolvent (where your liabilities exceed your assets). If this is the case, you can exclude your debt cancellation income by reporting your financial condition and filing IRS Form 982 with your tax return.
* Primary home
If your home is "short" sold or foreclosed and the lender receives less than the total amount of the outstanding loan, you can also expect that amount of debt cancellation to be reported to you and the IRS. But special rules allow you to exclude up to $2 million in cancellation income in many circumstances. You will again need to complete IRS Form 982, but the exclusion from taxable income brought about by the debt cancellation on your primary residence is incredibly liberal. So make sure to take advantage of these rules should they apply to you.
* Second home, rental property, investment property, business property
The rules for debt cancellation on second homes, rental property, and investment or business property can be extremely complicated. Generally speaking, the new laws that cover debt cancellation don't apply to these properties, and the IRS considers any debt cancellation income taxable. Nevertheless, given your cost of these properties, your financial condition, and the amount of debt cancelled, it's still possible to have this debt cancellation income taxed at a preferred capital gains rate, or even considered not taxable at all.
Be aware that many of the special debt cancellation provisions are set to expire at the end of 2012.
If you're unsure as to how debt cancellation affects you, contact your tax advisor (or ask us for a referral) to review your situation and determine how much, if any, cancelled debt will be taxable income to you.
Posted by Natalie Neith at 14:44 No comments:  Email ThisBlogThis!Share to TwitterShare to Facebook

Running my butt off

March19,2012

Went to Apollo Park this evening around 5:30 pm to do some running. It was perfect, no wind which in itself is a miracle because it is windy at that park everyday. Beautiful 74 degrees no wind not a lot of people. Was gonna only run 2.5 miles but ran 4 yes 4 miles with an average of 10:16 per mile my fastest. One of my goals is to get to a 9 min mile this year, could happen, (OK will happen). Oh and I didnt really run my butt off even tho it felt like it, I did use 798 calories.

Enhanced Lancaster Blvd. Farmers Market

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City to host ‘Enhanced BLVD Farmers Market’

March 14, 2012

By The AV Times Staff

LANCASTER – This Thursday, March 15, the City of Lancaster will present the “Enhanced BLVD Farmers’ Market,” kicking off the spring season of Farmers’ Markets. The Enhanced Farmers’ Market will bring a new crop of vendors to the weekly event, along with live music and activities.
“One of the main benefits of the Farmers’ Market is the increased business traffic it has brought along The BLVD,” said Mayor R. Rex Parris. “At the same time, the Famers’ Market has brought a greater variety of healthy food choices to the citizens of Lancaster.”
The expanded market will feature approximately 10 additional vendors offering a variety of goods. Products range from fresh fruits and vegetables to baked goods and snacks. The Farmers’ Market also boasts a collection of unique arts and crafts for sale, such as hand-crafted jewelry.
The classic rock band, The Usual Suspects of A.V., will perform live at the BeX stage at 4 p.m. The evening’s festivities will also include a car show sponsored by the Cadillac Car Club of the Antelope Valley, as well as children’s activities.
“The Farmers’ Market offers an opportunity for Antelope Valley residents to convene on The BLVD, while providing an excellent venue for farmers to promote and sell their products directly,” said City Council Member Sandra Johnson.
The BLVD Farmers’ Market is conducted through a partnership between the City of Lancaster and Raw Inspiration, a non-profit operator of California Certified Farmers’ Markets.
This event is offered every Thursday year-round on The BLVD between Date Avenue and Fig Avenue. Currently held from 2 p.m. – 7 p.m., the market will switch to summer operation hours (3 p.m. to 8 p.m.) on Thursday, May 3rd.
Vendors interested in joining the Farmers’ Market should Angela Riley in the Parks, Recreation and Arts Department at 661-723-6074 or complete an application online at www.rawinspiration.org.
(Information via press release from the City of Lancaster.)

American White Pelicans in The Desert

My wife and I visited Apollo Park yesterday and to our suprise swimming along with the Candian Geese, Coots, Ducks and white geese was a flock of about 20 of these White Pelicans. We are use to seeing the Brown Pelicans at the Beach. Apollo Park is in Lancaster Calif. located in the Mojave Desert.

American White Pelican - Pelecanus erythrorhynchos
Characteristics Range Habitat Diet Life Cycle Behavior	Classification Phylum: Chordata Class: Aves Order: Pelecaniformes Family: Pelecanidae Genus: Pelecanus	Click on the images for a larger view.

Characteristics The American white pelican about four feet tall and has a wingspan of about nine feet. It is entirely white except for its black-edged wings that are visible when the American white pelican is in flight. It has a long neck, a long orange bill with an expandable pouch and short orange legs with big webbed feet. In breeding season, it has a light yellowish crest on the back of its head and a nuptial tubercle or fibrous plate on the upper part of its bill. The nuptial tubercle will fall off when mating season is over and the crest will turn gray. Young American white pelicans have grayish markings on their heads and backs. Range The American white pelican breeds in isolated areas from Manitoba, Canada and Minnesota west to northern California. The American white pelican migrates to its winter grounds in early fall. It winters in California, Mexico, Central America, along the Gulf Coast and in Florida. Habitat The American white pelican lives on inland shallow freshwater lakes, wet prairies and marshes in the summer and on coastal lagoons in the winter.

Diet The American white pelican doesn't dive into the water for its food like the brown pelican. It floats on the water and scoops up fish and water in its pouch. It holds its heads up and drains out the water and then swallows the fish. The American white pelican only carries food in its pouch when it is taking food to its chick. American white pelicans often hunt for food in groups. They will form a line and start swimming towards shore while flapping their wings and herding their prey towards the shore. Sometimes, one group of pelicans will even drive the prey towards another group of pelicans! The American white pelican eats up to three pounds of fish per day. It also eats salamanders and crayfish. Life Cycle The American white pelican nests in colonies. Male and female American white pelicans show off their bright orange bills during courtship. They strut around, bow, and take short flights in an attempt to attract a mate. The female lays 1-3 eggs in a depression on the ground or on a mound of vegetation and dirt. Both parents incubate the eggs with their large webbed feet! The eggs hatch in about a month. If the female lays more than one egg, usually only the strongest one will survive. The other chicks die of starvation because they can't compete for food with their stronger sibling. Chicks are naked at birth. By the time they are 10 days old they are covered with white down. Both parents care for the young. The chicks dig regurgitated food out of their parents pouches. Chicks leave the nest and join the a pod or a creche of young pelicans when they are 17-28 days old. Chicks fledge when they are about 10 weeks old. Behavior The American white pelican is clumsy on land, but it is a good swimmer and very graceful in flight. American white pelicans fly in flocks in a long line, with their necks necks bent back over their bodies.

Shea's Castle

My first time being close to Shea's castle was in the early 70's when I lived with my foster parents the Boyd's. Mr. Boyd would take us up there on a summer night to listen to the skeletons walking around the castle grounds. He would tell us a story of Mr and Mrs. Shea walking around their castle. Years later I learned it was just the wood chimes at the castle.

Today is my first time on the grounds and in the Castle itself. Along with 15 other Realtors we got to roam the grounds and the castle and hear some fascinating history about this place right in the mist of our own Antelope Valley.Shea's Lodge or as most people in the Antelope Valley know of it Shea's castle was built in 1924. The Castle is a stone replica of a Medieval Irish Castle. Built by Richard Peter Shea. Mr. Shea purchased 506 acres on the very west side of Lancaster off of Munz Ranch Road. This place was a labor of love for the love of his life, his wife Ellen Shea. Mr. Shea was a real estate investor who had done very well. He sold properties he had in Los Angeles such as Hancock Park which he sold for $56 million, He took that money and bought the 506 acres in Lancaster, California and took $175,000 to build Shea's Lodge, which had 8 bedrooms,7 bathrooms,7 fireplaces and 2 kitchens. He hired 100 local labors to quarry thousands of tons of granite from boulders on the land. They built the 20ft high stone dam backed up by the man made 10 acre lake, they also built the stable to look like a castle , and the castle itself  and guest house.

In 1929 Mr. Shea was affected by the Stock Market crash. his finance's ruined. The Shea's borrowed against the castle but soon the bank took it over. In October of 1932 Mrs. Shea died from pernicious anemia and other complications. Two months later Mr. Shea walked into the Ocean and drowned. His body was found in the surf near Venice Pier. On his body they found a small container of his wife's ashes, he was 57 years old.

The castle has had 15 owners and renters in the last 5 decades. Roy Rogers trained his famous horse Trigger at the castle. There was also the notorious millionaire playboy Tommy Stewert Lee that owned the castle in 1948. Mr. Lee had some mental issues and his family had him declared mentally incompetent. He left the castle never to return, he jumped off a building in Los Angeles in 1950 and died.

In later years the castle has been used for movies such as" Dracula's Castle", and lots of episodic television, and tons of commercials and music videos.
So here we are 15 Realtors on this beautiful June 10th in 2011 touring the castle and grounds because once again it is up for sale. I am not sure but if you stand real still and listen I think you can hear those wood chimes from many years ago.

If you know someone looking for a castle give me a call.

My business sucks, oh poor me.

It is so easy when you work for yourself to become lazy and complaisant. I am the boss I can get up when I want too, make calls, if I want too, show or not show houses. I can also kill my business or start killing my business in a day. Well that's what I have been doing killing a business that I worked hard to start. Dude quit being a CANDYASS. This is what you will hear from Tom Ferry. He is a Coach, Mentor,and a pretty nice guy. He also tells it like it is. Watch his video on Am I Planting Enough Seeds? I don't know how he does it but he knows just the right message I need to hear. I jumped out of the Waambulance this Friday. I took a future home owner out showed him homes and discussed what would be a good fit for him in the way of purchasing a home. It felt good to be actually working with a client. Its a gonna be a long haul in this business I have chosen. But with help and inspiration from people like Tom Ferry, and Gary Vaynerchuk I believe I can do it. Check out Gary Vaynerchuk on a you tube or buy his book "CRUSH IT" or Gary vaynerchuk.com. Also Check out Tom Ferry.com

http://www.youtube.com/watch?v=0NNVptIrKH0