Does The Seller Have To Pay Taxes On “MY” Earnest Money?

Does The Seller Have To Pay Taxes On “MY” Earnest Money?

Imagine buying a 1 million dollar home and for whatever reason you lose your earnest money, say $10,000.00. The seller keeps it. Every single penny. You breached the contract, so there.

 

Does the seller have to pay taxes on that 10 grand?

Will the Title Company inform the gov’t that a check was cut to the seller for this $10,000.00?

Will the Listing Agent report the buyer?

 

I called several local title companies today and not one of them said it was company or federal protocol to inform the IRS about any earnest money being paid to any party.

What if the earnest money was $100,000.00?

 

If you lost $10,000.00 to the seller would you want them paying taxes on YOUR money? You did!

photo by: 401(K) 2012
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