pelhany wrote:How long after foreclosure before you receive a 1099? My house was foreclosed on in October 2009 in Maryland. At the foreclosure sell at the court house there were no bids on the house. I received papers from the court ratifying foreclosure in December 2009. The lender listed the property with a real-estate agent in October and sold the house. The new owners closed on the property January 19, 2010. How long after the foreclosure before I receive a 1099?
Under these circumstances, there should be no gain or loss to you, and therefore you would not receive a 1099. While there were no third party bids, the creditor obviously took title with a credit bid (which is to say, the creditor bid in the debt owed by you and secured by the house). Since the creditor did not send you a 1099 in 2009, when the transaction creating a gain or loss happened, it may well be that the lender bid in the entire amount of the indebtedness. Even if the lender did not bid in the balance due, and there remains a debt owed by you to the lender, until the lender forgives that indebtedness, and you should have no phantom income in the form of forgiveness of indebtedness income; of course, forgiveness of indebtedness can generate income and is reported on a 1099, but no forgiveness notice/release is mentioned by you, so that even has not yet happened.
The transaction under which the lender sold the house to a new owner, in early 2010, would under ordinary circumstances be a sale by the lender of property owned by the lender; a gain or loss on that sale would be a gain or loss to the lender, not phantom income to you.