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holder must file Form 1099-A for the second trust even

For an abandonment, enter the date you knew or had

though no part of the second trust was satisfied by the

reason to know that the property was abandoned unless

proceeds of the foreclosure sale.

you expect to commence a foreclosure, execution, or

similar action within 3 months, as explained earlier. If a

Abandonment

third party purchases the property at a foreclosure,

execution, or similar sale, the property is treated as

An abandonment occurs when the objective facts and

abandoned, and you have reason to know of its

circumstances indicate that the borrower intended to and

abandonment on the date of sale.

has permanently discarded the property from use. You

have “reason to know” of an abandonment based on all

Box 2. Balance of Principal Outstanding

the facts and circumstances concerning the status of the

property. You will be deemed to know all the information

Enter the balance of the debt outstanding at the time the

that would have been discovered through a reasonable

interest in the property was acquired or on the date you

inquiry when, in the ordinary course of business, you

first knew or had reason to know that the property was

become aware or should become aware of circumstances

abandoned. Include only unpaid principal on the original

indicating that the property has been abandoned. If you

debt. Do not include accrued interest or foreclosure costs.

expect to commence a foreclosure, execution, or similar

Box 3. Reserved

sale within 3 months of the date you had reason to know

that the property was abandoned, reporting is required as

Box 4. Fair Market Value (FMV) of Property

of the date you acquire an interest in the property or a

For a foreclosure, execution, or similar sale, enter the

third party purchases the property at such sale. If you

FMV of the property. See Temporary Regulations section

expect to but do not commence such action within 3

1.6050J-1T, Q/A-32. Generally, the gross foreclosure bid

months, the reporting requirement arises at the end of the

price is considered to be the FMV. If an abandonment or

3-month period.

voluntary conveyance to the lender in lieu of foreclosure

Statements to Borrowers

occurred and you placed an “X” in the checkbox in box 5,

enter the appraised value of the property. Otherwise,

If you are required to file Form 1099-A, you must provide a

make no entry in this box.

statement to the borrower. Furnish a copy of Form 1099-A

or an acceptable substitute statement to each borrower.

Box 5. Was Borrower Personally Liable for

For more information about the requirement to furnish a

Repayment of the Debt

statement to the borrower, see part M in the 2018 General

Instructions for Certain Information Returns.

If the borrower was personally liable for repayment of the

debt at the time the debt was created or, if modified, at the

Truncating borrower's TIN on statements. Pursuant to

time of the last modification, enter an “X” in the checkbox.

Treasury Regulations section 301.6109-4, all filers of

Form 1099-A may truncate a borrower's TIN (social

Box 6. Description of Property

security number (SSN), individual taxpayer identification

Enter a general description of the property. For real

number (ITIN), adoption taxpayer identification number

property, generally you must enter the address of the

(ATIN), or employer identification number (EIN)) on payee

property, or, if the address does not sufficiently identify

statements. Truncation is not allowed on any documents

the property, enter the section, lot, and block.

the filer files with the IRS. A lender's TIN may not be

truncated on any form. See part J in the 2018 General

For personal property, enter the applicable type, make,

Instructions for Certain Information Returns.

and model. For example, describe a car as “Car—2014

Honda Accord.” Use a category such as “Office

Account Number

Equipment” to describe more than one piece of personal

The account number is required if you have multiple

property, such as six desks and seven computers. Enter

accounts for a borrower for whom you are filing more than

“CCC” for crops forfeited on Commodity Credit

one Form 1099-A. Additionally, the IRS encourages you

Corporation loans.

to designate an account number for all Forms 1099-A that

you file. See part L in the 2018 General Instructions for

Specific Instructions for Form 1099-C

Certain Information Returns.

The creditor's phone number must be provided in

Box 1. Date of Lender's Acquisition or

the creditor's information box. It should be a

Knowledge of Abandonment

central number for all canceled debts at which a

CAUTION

person may be reached who will ensure the debtor is

For an acquisition, enter the date you acquired the

connected with the correct department.

secured property. An interest in the property generally is

acquired on the earlier of the date title is transferred to the

Do not file Form 1099-C when fraudulent debt is

lender or the date possession and the burdens and

canceled due to identity theft. Form 1099-C is to

benefits of ownership are transferred to the lender. If an

be used only for cancellations of debts for which

objection period is provided by law, use the date the

CAUTION

the debtor actually incurred the underlying debt.

objection period expires. If you purchase the property at a

sale held to satisfy the debt, such as at a foreclosure or

File Form 1099-C, Cancellation of Debt, for each

execution sale, use the later of the date of sale or the date

debtor for whom you canceled a debt owed to you of $600

the borrower's right of redemption, if any, expires.

or more if:

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Instructions for Forms 1099-A and 1099-C (2018)

Instructions For Forms 1099-A And 1099-C - Acquisition Or Abandonment Of Secured Property And Cancellation Of Debt - 2018 Page 2

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