Understanding Your Tax Forms 2016: Form 1099-A, Acquisition Or Abandonment Of Secured Property

By now, you probably have a stack of tax forms from employers, banks, stockbrokers, lenders and more on your desk – or more likely, the kitchen counter. For some of you, those tax forms will end up in the hands of your tax professional (for more on hiring a tax professional, click here); the rest of you will input the information on those forms, box for box, into tax preparation software – maybe with a little swearing along the way. No matter how you plan to do your taxes this year, you likely don’t know what all of the numbers, letters and other information on those forms mean. That’s about to change. This is the fifth in a series of posts meant help you make sense of all of those forms.
Here’s what you should know about the form 1099-A, Acquisition or Abandonment of Secured Property:
A form 1099-A, Acquisition or Abandonment of Secured Property, is issued by a lender when the lender receives an interest in property that was meant to be in full or partial satisfaction of the debt, or if the lender has reason to know that the property has been abandoned.
For purposes of the form 1099-A, property means any real property (such as a personal residence), any intangible property, and tangible personal property. However, the form 1099-A is not used to report tangible personal property, like a car, held for personal use (if it’s for trade or business or for investment, even if only partly, the form 1099-A is required). Additionally, no reporting is required if the property securing the loan is located outside the United States and you, as the borrower has furnished the lender a statement that you’re an exempt foreign person.
An abandonment occurs when it appears that you, as the borrower, intended to and permanently walked away from the property. The determination is based on facts and circumstances known to the lender.
You’ll want to pay attention to this form because, in some circumstances, you may have to treat the abandonment as though you sold the property. Because of the potential consequences, you’ll want to make sure that the information reported on the form is correct. If it’s not, you’ll need to contact the lender to make corrections.
The form 1099-A typically looks like this:

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