§580

Because the Hildreth property was nonjudicially foreclosed, it was a nonrecourse debt under California law. The general rule is that a disposition of property encumbered with nonrecourse debt triggers inclusion of the discharged debt only in the amount realized and not in a taxpayer’s gross income. See, e.g., Est. of Delman v. C

580b (West 2011). This means that when home buyers like the Simonsens buy a home with borrowed money, the lender can foreclose but isn't allowed to get ajudgment against the Simonsens for any ofthe debt that remains unpaid after foreclosure. Their other assets remain safe. The parties therefore agree that the Simonsens' purchase-money loan--se

580b (West 1976 & Supp. 2010), and of course the entire pawnshop industry is built on it. See National Pawnbrokers Association, “Pawnbroking Industry Overview” (2008-09), available at http://www. nationalpawnbrokers.org/files/Industry%200verview%207-7-09.pdf. A general statement about the unconditional obligation to pay as a key characteristic

Petitioner did not pursue a judgment in the California courts for the balance of the loan because he believed that California’s antideficiency statute, section 580b of the California Civil Procedure Code (2002), precluded any recovery.

580d (West 1976 & Supp. 1995). The statute reads, in pertinent part: No judgment shall be rendered for any deficiency upon a note secured by a deed of trust or mortgage upon real property or an estate for years therein hereafter executed in any case in which the real property or estate for years therein has been sold by the mortgagee or truste

580d (West 1976 & Supp. 1995). The statute reads, in pertinent part: No judgment shall be rendered for any deficiency upon a note secured by a deed of trust or mortgage upon real property or. an estate for years therein hereafter executed in any case in which the real property or estate for years therein has been sold by the mortgagee or trust

580b (West 1982); Freeland v. Commissioner, 74 T.C. 970, 971 (1980). 7We thus make no specific finding as to fair market value. - 10 - 2(c)(2), Example (7), Income Tax Regs. Moreover, the amount realized on the disposition of property subject to nonrecourse debt may include both the principal balance and accrued interest. See Allan v. Commiss