Which of the following pieces of information is the bank NOT required to report on Form 1099 for foreclosed and abandoned property?
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A. B. C. D.C
When a bank forecloses or takes possession of an abandoned property, it is required to report certain information on Form 1099 to the IRS and the borrower. The purpose of this form is to report the income that the borrower received from the discharge of indebtedness.
The bank is required to report the borrower's name, address, and TIN (Taxpayer Identification Number) on Form 1099. This information is necessary for the IRS to match the income reported on the form with the taxpayer's tax return.
The bank is also required to report a description of the property. This information helps the IRS determine the fair market value of the property and the amount of income that should be reported.
In addition, the bank is required to report the original loan amount. This information is necessary to determine the amount of the discharge of indebtedness income that the borrower received.
However, the bank is not required to report whether the borrower is personally liable for the debt. This information is not necessary to determine the amount of income that the borrower received from the discharge of indebtedness. Therefore, the correct answer to this question is D - whether the borrower is personally liable for the debt.