Welcome! Please use the navigational links to explore our website.
PartsASAP LogoCompany Logo (800) 853-2651

Shop Now

   Allis Chalmers Case Farmall IH Ford 8N,9N,2N Ford
   Ferguson John Deere Massey Ferguson Minn. Moline Oliver
 
Marketplace
Classified Ads
Photo Ads
Tractor Parts
Salvage

Community
Discussion Forums
Project Journals
Your Stories
Events Calendar
Hauling Schedule

Galleries
Tractor Photos
Implement Photos
Vintage Photos
Help Identify
Parts & Pieces
Stuck & Troubled
Vintage Ads
Community Album
Photo Ad Archives

Research & Info
Articles
Tractor Registry
Tip of the Day
Safety Cartoons
Tractor Values
Serial Numbers
Tune-Up Guide
Paint Codes
List Prices
Production Nbrs
Tune-Up Specs
Torque Values
3-Point Specs
Glossary

Miscellaneous
Tractor Games
Just For Kids
Virtual Show
Museum Guide
Memorial Page
Feedback Form

Yesterday's Tractors Facebook Page

  
Tractor Talk Discussion Board

Re: OT/Legal/Tax question


[ Expand ] [ View Replies ] [ Add a Reply ] [ Return to Forum ]

Posted by Mike (WA) on March 05, 2009 at 08:35:57 from (69.10.199.245):

In Reply to: OT/Legal/Tax question posted by rrlund on March 05, 2009 at 07:13:43:

IRS would treat it as a sale. You would compare your basis in the goods at the time of sale, to what you "received" from the sale. Basis is the amount of value left in the goods for tax purposes, generally cost less depreciation. What you "received" is the amount of reduction of the loan (plus excess funds, if it sold for more than was owed). If the stuff brought more at the sale than its basis, you're on the hook for capital gains tax on the difference.

The "imputed income" situation that Scotty brought up only came into play when you turned over the equipment or real estate in full satisfaction of the debt. They, you would be taxed on the amount of loan forgiveness that was above and beyond the fair market value of the stuff. Some exceptions generally kept folks out of that situation- if you were insolvent, or in bankruptcy, it didn't apply, and many were in that situation by the time such drastic measures as foreclosure occurred.

Even though this seems unfair (kicking you while you're down, so to speak), it was generally advantageous from a financial standpoint. If you had a loan of $100,000, and bank accepted R/E worth $75,000 in full satisfaction, you'd owe tax on $25,000- lets say, 4 grand. However, if bank just did a sale and applied the proceeds, you'd still owe 25 grand.

The most cruel application of the rule is when you tried to be a good guy and give the bank a "deed in lieu of foreclosure" voluntarily, instead of making them go through the foreclosure process. Thanks for doing the right thing, and by the way, Surprise! You owe some tax!

Happy to say, the "imputed income" rule has been suspended by IRS, beginning in 2007, and on into the forseeable future (translation- until economy gets back on its feet, and they can resume taxing the daylights out of us).


Replies:




Add a Reply

:
:
:

:

:

:

:

:

:

Advanced Posting Options

: If you check this box, email will be sent to you whenever someone replies to this message. Your email address must be entered above to receive notification. This notification will be cancelled automatically after 2 weeks.



 
Advanced Posting Tools
  Upload Photo  Select Gallery Photo  Attach Serial # List 
Return to Post 

TRACTOR PARTS TRACTOR MANUALS
We sell tractor parts!  We have the parts you need to repair your tractor - the right parts. Our low prices and years of research make us your best choice when you need parts. Shop Online Today. [ About Us ]

Home  |  Forums


Today's Featured Article - Listening to Your Tractor - by Curtis Von Fange. Years ago there was a TV show about a talking car. Unless you are from another planet, physically or otherwise, I don’t think our internal combustion buddies will talk and tell us their problems. But, on the other hand, there is a secret language that our mechanical companions readily do speak. It is an interesting form of communication that involves all the senses of the listener. In this series we are going to investigate and learn the basic rudimentary skills of understanding this lingo. ... [Read Article]

Latest Ad: 2022 John Deere 5045E, 4wd, front end loader and 3rd function with grapple. 120 hrs, 55k new, must sell [More Ads]

Copyright © 1997-2024 Yesterday's Tractor Co.

All Rights Reserved. Reproduction of any part of this website, including design and content, without written permission is strictly prohibited. Trade Marks and Trade Names contained and used in this Website are those of others, and are used in this Website in a descriptive sense to refer to the products of others. Use of this Web site constitutes acceptance of our User Agreement and Privacy Policy

TRADEMARK DISCLAIMER: Tradenames and Trademarks referred to within Yesterday's Tractor Co. products and within the Yesterday's Tractor Co. websites are the property of their respective trademark holders. None of these trademark holders are affiliated with Yesterday's Tractor Co., our products, or our website nor are we sponsored by them. John Deere and its logos are the registered trademarks of the John Deere Corporation. Agco, Agco Allis, White, Massey Ferguson and their logos are the registered trademarks of AGCO Corporation. Case, Case-IH, Farmall, International Harvester, New Holland and their logos are registered trademarks of CNH Global N.V.

Yesterday's Tractors - Antique Tractor Headquarters

Website Accessibility Policy