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Erin's bank foreclosed on her office building when she stopped making payments on her loan. The loan was secured by the building when she purchased it three years ago for $750,000. Erin's Form 1099-A is shown below. If the building is sold for the fair market value (FMV), how much of Erin's personal assets can the lender attempt to collect to satisfy the judgment? (Answer choices are below the image.) LENDER'S name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone no OAK RIDGE BANK 301 AUSTIN STREET YOUR CITY, YS XXXXX (XXX) 555-5678 LENDER'S TIN XX-XXXXXXX BORROWER'S name ERIN HERNANDEZ Street address (including apt. no.) 308 VIRGINIA AVENUE CORRECTED (if checked) BORROWER'S TIN XXX-XX-XXXX Account number (see instructions) XXXXXXXX Form 1099-A Rev. 1-2022) City or town, state or province, country, and ZIP or foreign postal code YOUR CITY, YS XXXXX (keep for your records) $615,000 $595,000 $20,000 SO (None of Erin's personal assets) OMB No. 1545-0877 Form 1099-A (Rev January 2022) For calendar year 2023 1 Date of lender's acquisition or 2 Balance of principal knowledge of abandonment 05/01/2023 outstanding Acquisition or Abandonment of Secured Property $ 615,000.00 4 Fair market value of property This is important tax information and is being fumished to the RS you are required to file a retum, a negligence penalty or other sanction may be imposed on you taxable income results from this transaction and the IRS determines that it has not been reported. Department of the Treasury-Internal Revenue Service $ 595,000.00 5 checked, the borrower was personally liable for repaym of the debt V 6 Description of property 108 WOODLAWN STREET YOUR CITY, YS XXXXX www.is.gov/Form1099A Copy B For Borrower

Erin's bank foreclosed on her office building when she stopped making payments on her loan. The loan was secured by the building when she purchased it three years ago for $750,000. Erin's Form 1099-A is shown below. If the building is sold for the fair market value (FMV), how much of Erin's personal assets can the lender attempt to collect to satisfy the judgment? (Answer choices are below the image.) LENDER'S name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone no OAK RIDGE BANK 301 AUSTIN STREET YOUR CITY, YS XXXXX (XXX) 555-5678 LENDER'S TIN XX-XXXXXXX BORROWER'S name ERIN HERNANDEZ Street address (including apt. no.) 308 VIRGINIA AVENUE CORRECTED (if checked) BORROWER'S TIN XXX-XX-XXXX Account number (see instructions) XXXXXXXX Form 1099-A Rev. 1-2022) City or town, state or province, country, and ZIP or foreign postal code YOUR CITY, YS XXXXX (keep for your records) $615,000 $595,000 $20,000 SO (None of Erin's personal assets) OMB No. 1545-0877 Form 1099-A (Rev January 2022) For calendar year 2023 1 Date of lender's acquisition or 2 Balance of principal knowledge of abandonment 05/01/2023 outstanding Acquisition or Abandonment of Secured Property $ 615,000.00 4 Fair market value of property This is important tax information and is being fumished to the RS you are required to file a retum, a negligence penalty or other sanction may be imposed on you taxable income results from this transaction and the IRS determines that it has not been reported. Department of the Treasury-Internal Revenue Service $ 595,000.00 5 checked, the borrower was personally liable for repaym of the debt V 6 Description of property 108 WOODLAWN STREET YOUR CITY, YS XXXXX www.is.gov/Form1099A Copy B For Borrower

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Erin's bank foreclosed on her office building when she stopped making payments on her loan. The loan was secured by the building when she purchased it three years ago for $750,000. Erin's Form 1099-A is shown below. If the building is sold for the fair market value (FMV), how much of Erin's personal assets can the lender attempt to collect to satisfy the judgment? (Answer choices are below the image.) LENDER'S name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone no. OAK RIDGE BANK 301 AUSTIN STREET YOUR CITY, YS XXXXX (XXX) 555-5678 LENDER'S TIN XX-XXXXXXX BORROWER'S name ERIN HERNANDEZ Street address (including apt. no.) 308 VIRGINIA AVENUE CORRECTED (if checked) BORROWER'S TIN XXX-XX-XXXX Account number (see instructions) XXXXXXXX Form 1099-A (Rev. 1-2022) City or town, state or province, country, and ZIP or foreign postal code YOUR CITY, YS XXXXX (keep for your records) $615.000 $595,000 $20,000 OSO (None of Erin's personal assets) 1 Date of lender's acquisition or knowledge of abandonment 05/01/2023 3 OMB No. 1545-0877 Form 1099-A (Pen. January 2022) For calendar year 2023 2 Balance of principal outstanding www.is.gov/Form1099A Acquisition or Abandonment of Secured Property $ 615,000.00 4 Fair market value of property $ 595,000.00 5 checked, the borrower was personally liable for repay of the debt 6 Description of property 108 WOODLAWN STREET YOUR CITY, YS XXXXX This is important tax information and is being furnished to the IRS. I you are required to file a return, a negligence penalty or other sanction may be imposed on you d taxable income results from this transaction and the IRS determines that it has not been reported. Department of the Treasury - Internal Revenue Service Copy B For Borrower
Transcribed Image Text:Erin's bank foreclosed on her office building when she stopped making payments on her loan. The loan was secured by the building when she purchased it three years ago for $750,000. Erin's Form 1099-A is shown below. If the building is sold for the fair market value (FMV), how much of Erin's personal assets can the lender attempt to collect to satisfy the judgment? (Answer choices are below the image.) LENDER'S name, street address, city or town, state or province, country, ZIP or foreign postal code, and telephone no. OAK RIDGE BANK 301 AUSTIN STREET YOUR CITY, YS XXXXX (XXX) 555-5678 LENDER'S TIN XX-XXXXXXX BORROWER'S name ERIN HERNANDEZ Street address (including apt. no.) 308 VIRGINIA AVENUE CORRECTED (if checked) BORROWER'S TIN XXX-XX-XXXX Account number (see instructions) XXXXXXXX Form 1099-A (Rev. 1-2022) City or town, state or province, country, and ZIP or foreign postal code YOUR CITY, YS XXXXX (keep for your records) $615.000 $595,000 $20,000 OSO (None of Erin's personal assets) 1 Date of lender's acquisition or knowledge of abandonment 05/01/2023 3 OMB No. 1545-0877 Form 1099-A (Pen. January 2022) For calendar year 2023 2 Balance of principal outstanding www.is.gov/Form1099A Acquisition or Abandonment of Secured Property $ 615,000.00 4 Fair market value of property $ 595,000.00 5 checked, the borrower was personally liable for repay of the debt 6 Description of property 108 WOODLAWN STREET YOUR CITY, YS XXXXX This is important tax information and is being furnished to the IRS. I you are required to file a return, a negligence penalty or other sanction may be imposed on you d taxable income results from this transaction and the IRS determines that it has not been reported. Department of the Treasury - Internal Revenue Service Copy B For Borrower
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