You have investigated your options and have touched base with a real estate tax attorney and/or CPA.
It appears short sale will be your best option.
Make sure you have already communicated with the bank that your intent is to perform a short sale.
Find an experienced Agent who has a proven track of short sale experience. Certifications and designations does not always make for a seasoned agent even though many of the certification programs do present great information and knowledge etc.
Understand you will be asked for a full financial disclosure. Some banks want more info than others.
Typically they will want monthly financial statement of your expenses and income.
Usually they will ask for 1- 3 months of bank statements, copies of any 401K statements or other retirement statements, a copy of any other assets, pay check stubs and income tax statements.
I recommend my client keep a folder either electronically or physically with updated statements and paystubs.
As the process proceeds it is typical for the lenders to ask for updated accounts etc.
Do NOT try to hide things or assets. They will scour your credit and accounts and look for red flags.
Keep your home up and cooperate with showings. We want backup offers.
Always have an attorney review the short sale approval letters before proceeding. Our contracts in California allow for addendums to short sale that state the sellers have the right to have legal counsel preview and approve any and short sale approval letters and terms before proceeding.
Remember, Realtor(R) are not attorneys and cannot give legal advice. We can provide you resources to search and investigate options but we cannot tell what to do, interpret short sale approval letters or advise you in regards to tax matters.