The Mortgage Debt Relief Act of 2007 has been extended one more year through 2012. This will prevent Homeowners from being taxed on mortgage debt that is forgiven.
The Mortgage Debt Relief Act was set to expire on December 31, 2012. Without the extension homeowners who sold their homes through short sale or foreclosure or homeowners who modified their loans would have been taxed in the tens of thousands and this was predicted by industry officials to hurt the housing recovery.
Tax rates will also remain the same for households earning less than $450,000 for married couples and $400,000 for single filers due to the passing of the “America Taxpayer Relief Act of 2012.”
For more information, contact Orange Coast Title Company of Southern California at octitle.com