Central District Consumer Bankruptcy Attorney's Association

If you put both rental income and secured payments for the rental property under income from business, they should net out to zero.
Mark JM wrote:

Here's a tough one:

1. Debtor owns rental properties.
2. One of the properties on which he received rental income in the past 6 months has already been foreclosed on.
3. In our jurisdiction (CD California) we are allowed to deduct secured payment expense on the means test form even if the property is going to be foreclosed (i.e. surrendered) but I don't think we can do that AFTER it's been foreclosed (because the debtor is no longer contractually due to make the secured payments then (right??).
4. On the means test form, line 5, it asks for rental income received in the past 6 months, but specifically EXCLUDES secured debt payments made to offset the rental income (because those payments are subtracted "below the line" later on in the means test if the debtor is over median.
5. In this case, as a result of the rental payments received in the past 6 months, the debtor is over median.

Can I now include the secured debt payments that debtor was obligated to make in the prior 6 months (before foreclosure) on line 5 of the means test form? It seems bizarre, even under BARF, that the debtor cannot offset the rental income by those mortgage payments.

And for those of you who will just say "wait a few months", we need to file before the other rental properties go to foreclosure to prevent the 1099 income being issued.


______________________
Mark J. Markus
Law Office of Mark J. Markus
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)509-1460 (fax)
web: http://www.bklaw.com/
This Firm is a Qualified Federal Debt Relief Agency
___________
NOTICE: This Electronic Message contains information from the law office of Mark J. Markus that may be privileged. The information is intended for the use of the addressee only. If you are not the addressee, note that any disclosure, copy, distribution or use of the contents of this message is prohibited.
IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication (or in any attachment).
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If you put both rental income and secured payments for the rental property under income from business, they should net out to zero.Mark JM <bklawr@yahoo.com> wrote: Here's a tough one: 1. Debtor owns rental properties. 2. One of the properties on which he received rental income in the past 6 months has already been foreclosed on. 3. In our jurisdiction (CD California) we are allowed to
deduct secured payment expense on the means test form even if the property is going to be foreclosed (i.e. surrendered) but I don't think we can do that AFTER it's been foreclosed (because the debtor is no longer contractually due to make the secured payments then (right??). 4. On the means test form, line 5, it asks for rental income received in the past 6 months, but specifically EXCLUDES secured debt payments made to offset the rental income (because those payments are subtracted "below the line" later on in the means test if the debtor is over median. 5. In this case, as a result of the rental payments received in the past 6 months, the debtor is over median. Can I now include the secured debt payments that debtor was obligated to make in the prior 6 months (before foreclosure) on line 5 of the means test form? It seems bizarre, even under BARF, that the debtor cannot offset the rental
income by those mortgage payments. And for those of you who will just say "wait a few months", we need to file before the other rental properties go to foreclosure to prevent the 1099 income being issued. ______________________Mark J. MarkusLaw Office of Mark J. Markus11684 Ventura Blvd. PMB #403Studio City, CA 91604-2652(818)509-1173 (818)509-1460 (fax)web: http://www.bklaw.com/This Firm is a Qualified Federal Debt Relief Agency___________NOTICE: This Electronic Message contains information from the law office of Mark J. Markus that may be privileged. The information is intended for the use of the addressee only. If you are not the addressee, note that any disclosure, copy, distribution or use of the contents of this message is prohibited.IRS CIRCULAR 230 NOTICE: To ensure compliance
with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication (or in any attachment).
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Here's a tough one:
1. Debtor owns rental properties.
2. One of the properties on which he received rental income in the past 6 months has already been foreclosed on.
3. In our jurisdiction (CD California) we are allowed to deduct secured payment expense on the means test form even if the property is going to be foreclosed (i.e. surrendered) but I don't think we can do that AFTER it's been foreclosed (because the debtor is no longer contractually due to make the secured payments then (right??).
4. On the means test form, line 5, it asks for rental income received in the past 6 months, but specifically EXCLUDES secured debt payments made to offset the rental income (because those payments are subtracted "below the line" later on in the means test if the debtor is over median.
5. In this case, as a result of the rental payments received in the past 6 months, the debtor is over median.
Can I now include the secured debt payments that debtor was obligated to make in the prior 6 months (before foreclosure) on line 5 of the means test form? It seems bizarre, even under BARF, that the debtor cannot offset the rental income by those mortgage payments.
And for those of you who will just say "wait a few months", we need to file before the other rental properties go to foreclosure to prevent the 1099 income being issued.
______________________
Mark J. Markus
Law Office of Mark J. Markus
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)509-1460 (fax)
web: http://www.bklaw.com/
This Firm is a Qualified Federal Debt Relief Agency
___________
NOTICE: This Electronic Message contains information from the law office of Mark J. Markus that may be privileged. The information is intended for the use of the addressee only. If you are not the addressee, note that any disclosure, copy, distribution or use of the contents of this message is prohibited.
IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication (or in any attachment).

The post was migrated from Yahoo.