Deduct loss from bad short sale transaction?

[stanw]

I entered into a contract to purchase a short sale last year, and paid escrow fees, and for two inspections, and an appraisal, however, the owner would not move out, breaking his end of the contract, and I did not get the home. Are any of the costs associated with this bad deal deductible?

Thanks in advance!

[rangerj]

If the purchase, or attempted purchase, was of a personal residence then the loss is not deductible. You might check with the states attorney Generals office and see if this breach of contract amounts to a theft. If the transaction is a theft of fraud you may have a theft or casualty loss.

[mwcpa]

"If the purchase, or attempted purchase, was of a personal residence then the loss is not deductible"


if this was a "business" transaction, the result may be different....

I would seek the advise of a qualified attorney related to the alleged breach you noted... chances are your attorney did not offer to look at it because his/her fees would exceed any benefit you would have gotten if you prevailed...sometimes it is best to just take the hit on the chin and move on...

[stanw]

The owner of the house filed for bankruptcy over a year ago, owes millions, owes the IRS for back taxes, in short, he has been scamming everyone for years and I am not sure if there is any benefit to me trying to sue the prick...

Thank for the advice and replies.