Bank of America

A federal judge has granted final approval to a class action lawsuit settlement over allegations that Bank of America failed to report to the Internal Revenue Service over $1.5 billion in mortgage interest that had actually been paid by mortgage holders. As a result, Class Members overpaid their taxes and will receive compensation of at least $40 from the Bank of America class action settlement.

Who’s Eligible

Class Members of the Bank of America mortgage interest settlement include all U.S. consumers who made payments of deferred interest on their option adjustable rate mortgage (“option ARM”) with Bank of America, N.A. in 2009, 2010, 2011, 2012, or 2013. Class Members can participate in the class action settlement even if they no longer own the property that had the option ARM mortgage.

Potential Award

At least $40. The Bank of America class action settlement will provide the following compensation to Class Members:

  • If you made payments of deferred interest in tax year 2009, the class action settlement provides you with 75 percent of the approximate tax deduction value of your payments of deferred interest during the year. Monetary compensation is provided because the time period for filing amended income tax returns for 2009 has expired. To receive this payment, you must submit a timely Claim Form showing that you qualify for the payment.
  • If you made payments of deferred interest in tax years 2010, 2011, or 2012, the class action settlement provides you with amended Forms 1098 reporting your payments of deferred interest in those years. In addition, for each amended Form 1098 you receive, you will receive $40 to help defray tax preparation costs associated with amending your tax returns to claim deductions for the previously unreported payments of deferred interest. You do not need to do anything to receive these benefits under the Settlement. It is anticipated that you will receive your amended Forms 1098 by March 15, 2014, and will receive your $40 payment per each amended Form 1098 within 31 calendar days after the deadline for submitting Claim Forms expires or after the settlement becomes effective, whichever is later.
  • If you made payments of deferred interest in tax year 2013, the Bank of America class action settlement requires the bank to report on Form 1098 for tax year 2013 your payments of deferred interest for the year.

 

Proof of Purchase

N/A

Claim Form Deadline

7/13/2014

Case Name

Richard Horn v. Bank of America NA, Case No. 12-cv-01718, U.S. District Court, Southern District of California.

Case Summary

The Bank of America class action lawsuit accuses the bank of not reporting over $1.5 billion in mortgage interest paid by option ARM customers to the Internal Revenue service for tax years 2009, 2010, 2011, and 2012. As a result, plaintiffs allege this caused them and other option ARM borrowers to overpay their taxes, as they did not claim a mortgage interest deduction for their payments of deferred interest in those years.

According to the class action settlement notice:

“As you may recall, your ARM allows borrowers to make a monthly ‘minimum payment’ that was often less than the interest that was actually owed in a particular month. The portion of the interest that you did not pay in those months is called “deferred interest.” According to Bank of America’s records, you eventually paid all or a portion of that “deferred interest” in 2009, 2010, 2011, 2012, or 2013. You may have done so, for example, when you sold or refinanced your house, or when you made a payment in a given month on your option ARM that was in excess of the interest owed for that month.”

Bank of America denies any wrongdoing but has agreed to a class action lawsuit settlement to resolve the litigation. The Bank of America mortgage settlement was approved on April 11, 2014.

Final Hearing

4/11/2014

Settlement Website
Claims Administrator

Horn Settlement
c/o GCG
P.O. Box 35113
Seattle, Washington 98124-5113

Email: info@HornSettlement.com
Phone: (877) 899-4117.

Class Counsel

David J. Vendler, Esq.
Morris, Polich & Purdy LLP

Michael R. Brown, Esq.
Michael R. Brown, APC

Jeffrey D. Poindexter, Esq.
Law Office of Jeffrey D. Poindexter

Defense Counsel

Peter B. Morrison, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP

UPDATE: Money from the Horn v. Bank of America class action settlement will be mailed no later than Aug. 20, 2014, according to the Settlement Administrator. If you get a check, let us know!

We tell you about cash you can claim EVERY WEEK! Sign up for our free newsletter.

10 Comments

  • jim April 22, 2014

    nothing ever arrived. the only ones who will make out will be the irs and the lawyers. all others are screwed!

  • JH June 26, 2014

    Are you aware of a similar class action suit for BOA fixed rate interest mortgage holders? I am convinced that they have failed to properly report the mortgage interest paid on my account last year. I was happy to see this settlement, then noticed that it only applied to ARMS. The responses to my inquiries are ridiculous and do not apply to the question. Over and over. It’s like the plan is to ignore me until I stop asking. This has caused me to overpay the IRS for 2013.

  • Pam Bessette August 23, 2014

    We have never received any of the said compensation for the 3 amended tax forms that we sent to the IRS. What if anything should we do or are we toooooo late? We received 3 letters that we would be part of the class action suit and were advised that we didn’t have to do anything (no forms to fill out) for this money for each year that Bank of America tried to screw us out of money,

    • chris grothouse October 5, 2014

      Also posted about this today, we sent amended 2011 forms in March 2014, and never received any refunds for overpayment. After calling, seems the IRS did not receive the electronic verification of the 1098 form that we sent, so my file was closed??

  • sharon August 25, 2014

    The check was suppose to be mailed no later than Wednesday August 20 but have not receive it as of 8/25/2014

    • LA. August 25, 2014

      RECEIVED LETTER TODAY, I WAS DENIED

  • The bob August 26, 2014

    35.00 yesterday

    • Top Class Actions August 28, 2014

      Thanks for letting us know! See the update below.

  • Top Class Actions August 28, 2014

    UPDATE: Money from the Horn v. Bank of America class action settlement will be mailed no later than Aug. 20, 2014, according to the Settlement Administrator. If you get a check, let us know!

  • chris grothouse October 5, 2014

    My wife and I had a BofA deferred interest loan for 2011, received corrected 1098 and sent amended tax form to IRS in March of 2014, after hours of numerous phone calls to the IRS, they have the copy of 1098 that I submitted, but can not verify amount because they “did not” receive the electronic verification of this form from BofA, or what ever third party is supposed to send to IRS, so my amended file was closed, no refund?? Called BofA, just got the run around that this was part of a law suit. Who is responsible for filing the electronic 1098 to the IRS?? I think BofA, and in my case and maybe others they just delay this until the time to file the amended form expires, then they don’t have to claim the interest. This should be looked into, if so should be another law suit.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Categorized in: