Wednesday, January 9, 2013
Thursday, January 3, 2013
The Mortgage Forgiveness Debt Relief Act and Debt Cancellation
Great news for short sales and distressed property owners!
As part of the 11th hour fiscal cliff deal, lawmakers managed to extend the Mortgage Forgiveness Debt Relief Act.
The extension means that homeowners will continue to be excused from paying taxes on forgiven mortgage debt through 2013. The original law, established in 2007 to help stabilize the housing market, was set to expire on December 31, 2012.
Without an extension, homeowners who completed short sales or loan modifications may have faced tax bills in the tens of thousands of dollars. This could have significantly discouraged short sales and encouraged foreclosures, which would have greatly hindered the housing recovery.
Source
As part of the 11th hour fiscal cliff deal, lawmakers managed to extend the Mortgage Forgiveness Debt Relief Act.
The extension means that homeowners will continue to be excused from paying taxes on forgiven mortgage debt through 2013. The original law, established in 2007 to help stabilize the housing market, was set to expire on December 31, 2012.
Without an extension, homeowners who completed short sales or loan modifications may have faced tax bills in the tens of thousands of dollars. This could have significantly discouraged short sales and encouraged foreclosures, which would have greatly hindered the housing recovery.
Source
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