Re: Foreclosure

Posted by MDRealest8 on December 25, 2007 at 22:49:10:

In Reply to: Re: Foreclosure posted by Julio Martinez-Clark on December 20, 2007 at 09:08:11:

Tee,
The day you posted your question and concern
(20.Dec.2007) is the day a new (temporary) law was passed on none other than deficiency judgements!

The Mortgage Forgiveness Act of 2007 was signed into law 20.Dec.2007 and is now official.
Prior to this action, forgiven mortgage debt due to foreclosure, short sale, or deed in lieu of foreclosure, was potentially taxable income to the borrower. This was the subject of much media attention and led to many questions and concerns from Sellers wondering whether or not they were going to get “hit with taxes.”

The new law, however, temporarily waives these taxes for debts forgiven (as high as 35%) from the beginning of 2007 to the end of 2009.

This will effectively put an end to the question from Sellers . . . will I be taxed? The definitive answer (at least until the end of 2009) is NO!

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