Monday, February 11, 2008
Mortgage Forgiveness Dept Relife Act of 2007
On Thursday December 20th President Bush signed into law a bill passed by Congress HR:3648. This bill is also know as the Mortgage Forgiveness Debt Relief Act of 2007. The bill can be a huge help for people considering a "Short Sale" in that unpaid mortgage debt is not considered taxable income. eg: Your home has a current market value of $350,000 and your mortgage balance is $400,000 under the old law if the bank forgave the difference on a the sale you would have to declare the $50,000 as a taxable income. The new law eliminates this "Phantom Tax". Refer to HR3648 for all the details.