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I am not on the mortgage and my soon to be exspouse wants to short sale. Am I responsible for taxes? We aren't divorced yet.

Naperville, IL |

I am not on the mortgage and have not lived in the house for one year. I stopped paying any portion of the mortgage about 6 months ago. Is there a form I can sign releasing me from any responsibility?

Attorney Answers 3

  1. Best answer

    I assume you mean taxes resulting from any deficiency caused by the short sale and the resulting 1099-C forms that are sent to the IRS by the lender(s). If you are truly not on any of the notes secured by the property then it is not your debt. I assume you will not be filing a tax return jointly with your estranged spouse. Your spouse may be entitled to one of the IRS' several exceptions to owing taxes on the forgiven amounts as well. See IRS publication 4681

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  2. Why are you asking on here and not discussing this with your divorce lawyer? You may not be liable to the third part lender but you are still liable for marital debt. The home I am presuming is marital so you are on the hook for debt associated with it and deficiencies. It is not just so simple as signing a paper. The divorce court has jurisdiction over you, your marital home, and the debt, and the court calls the shots and not you sir.

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  3. You could be. A short sale has to be handled carefully. Instead of getting tagged why not spend a little money on an attorney.

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