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Great news!  The Mortgage Debt Forgiveness Act, which extends the tax break for the forgiven debt to many of our clients who have gone through a short sale.  Just recently the Senate finally gave a positive vote on this after the House had already passed same. This should also open up the door for an increase in short sale activity from many homeowners waiting to see if the Act would be extended.  Yes, this Act needs to be re-approved each year.

What am I talking about?!  Well, when someone sells their home via a short sale (and there is some criteria you need to meet), if this Mortgage Debt Forgiveness Act is not approved and in place, the homeowner would have to pay taxes on the deficiency amount.  In other words, you sold your home for $400k and the mortgage on the home was for $500k.  You would pay taxes on the $100k deficiency. 

Questions?  Please contact:

Chris "CK" Kravetz
Broker, GRI, Realtor
@properties

Mobil:  847.867.7990

 


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