Read and prepare an executive summary for one of the followi

Read and prepare an executive summary for one of the following articles from Tierra Grande, @ recenter.tamu.edu:
Double Whammy--Foreclosure and Taxes,\" January 2008;

Solution

Foreclosures are making headlines these days, both nationally and in Texas. While income taxes may be the last thing on the minds of homeowners facing foreclosure, there are tax implications to consider. Two taxes are linked to foreclosure: • Tax No. 1 is based on ordinary taxable income associated with the cancellation of debt (not applicable with nonrecourse loans), and • Tax No. 2 is based on taxable gain from disposition of the home (applicable with both recourse and nonrecourse borrowings).Foreclosure has two possible tax consequences. Tax may be due as ordinary taxable income associated with the cancellation of debt or as taxable gain from the disposition of the asset.