My CH 7 recently discharged. I included the mortgage on an investment property, way upside down. I'm aware that any debts discharged through BK are excluded from income tax normally due from debt cancellation. Does anyone know for sure if this exclusion applies the same whether I let the lender foreclose, or give them a deed in lieu, or execute a short sale. I have a short sale working through a realtor, and just want to be sure I'm not creating a tax problem for myself. If you have actual experience or input from a tax professional, I'd really appreciate hearing from you.
