The legacy is where the home sold at orgination and the default was scheduled using a dated coded system. Plead what you will and believe what you will counsel …there is no mortage to speak of here in the Legacy variety .
Here we have the Installment Sale Basics where the gain or loss from the sale is usually recognized upon any sale exchange or other disposition of property. IRC § 1001. That time of recognition is on the day of the foreclosure and this is the proverbial scam.
See IRC § 453 where it does not exclude gain from income, but in some situations
permits a taxpayer to recognize gain from the disposition of property when
the taxpayer receives cash or property other than the buyer’s promise to pay in the future.
• Example: Joe Blow owns land in Kokomo held by Taxpayer as a capital asset. Taxpayer sells land back to Buyer. Buyer who in this case is the Lender does not pay Taxpayer cash at the “orgination” closing. Instead, Lender gives Taxpayer MERS a promissory note requiring Buyer to pay the purchase price in cash 10 years later. Taxpayer MERS is eligible to use the installment sale accounting method under IRC § 453, Taxpayer MERS does not recognize any gain from the sale of the consumers land until the tax year in which it receives payment under the note.
You need accountants to audit your file before you enter a pleaded response. If not us do find an accountant to come to your aid under counter claims that IRC 453 and a 10 years tax deferred sale is NOT a mortgage.
Otherwise your left with little shot of any kind of successful outcome. Also available to audit foreclosure with regards to attorney client malpractice suits.
Contact us for arranging an audit before your case makes it into court.