Will the Mortgage Forgiveness Debt Relief Act be extended?

Nov - 29 | | No comments. | Uncategorized

Will the Mortgage Forgiveness Debt Relief Act be extended yet again?

According to 41 Attorney Generals it’s a critically important extension for millions of homeowners.  In a letter included below dated November 20, 2012- 41 AG’s have urged congress to allow an extension of this act which provides homeowners with an exemption of the taxes owed if they short sale, modify or foreclose on a home where debt is forgiven. Debt forgiveness will always result in a tax owed to the IRS by the forgiven borrower and in cases of a home mortgage can mean tens of thousands in taxes due if the homeowner does not qualify for other exemptions under the federal and state tax code.

Mortgage Forgiveness Debt Relief Act extension?

The Mortgage Forgiveness Debt Relief Act extension seems natural considering that the national mortgage settlement, which obligates five of the largest mortgage services to provide $20 billion in credited consumer relief. The relief must be provided within three years as of March 2012, not extending would seem counter productive to the settlement that has yet to be completely resolved.

Mortgage Forgiveness Debt Relief Act

Mortgage Forgiveness Debt Relief Act

As a homeowner, you must be aware of this extension and know how it will affect your individual situation. In addition to this relief there has always been IRS Tax Form 982, which allows for an exemption in the event you have more liabilities than assets at the time of the settlement.

If you want to speak with me or get connected to a trained professional in your area, feel free to contact me direct.

Mortgage Forgiveness Debt Relief Act Resources:

Read my original post on the Mortgage Forgiveness Debt Relief Act

Mortgage Forgiveness Debt Relief Act on the IRS Website

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