Obama Proposes Extending Tax Waiver on Mortgage Debt Forgiveness
Submitted by bobbyw24 on Thu, 02/16/2012 - 08:44in
Obama’s FY2013 budget proposal includes an extension of the Mortgage Forgiveness Debt Relief Act of 2007.
The Act ensures that homeowners who received principal reductions or other forms of debt forgiveness on their primary residences do not have to pay taxes on the amount forgiven.
Without the Mortgage Forgiveness Debt Relief Act, debt reduced through mortgage modifications or short sales qualifies as income to the borrower and is taxable. Under the act, up to $2 million in debt elimination can be tax-free.
http://www.dsnews.com/articles/obama-proposes-extending-tax-...
