Arlington, VA asked in Tax Law and Real Estate Law for Maryland

Q: I received cash for keys last year. I got a 1099 from lender w/a chk in box 3. Do I have to claim this on my taxes?

I filed for bankruptcy in 2009. Last year BofA worked out cash for keys so I could move out of the house. This year I received a 1099 with a check mark in box 3. Do I have to claim this on my taxes? Are there any precedents that homeowners do not have to claim this as income?

Related Topics:
1 Lawyer Answer
Richard Sternberg
Richard Sternberg
  • Potomac, MD
  • Licensed in Maryland

A: Income is "Income from any source." If the income could be a settlement for a foreclosure, you might treat it was a return of equity. Consult your tax advisor. But, if this was the normal cash for keys, and you were a tenant, it is income.

Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.

The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.

Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.