Update: Federal taxes on forgiven short sales

Update: Federal Taxes on Short Sales Forgiven in CA 2014   Since the Mortgage Debt relief act of 2007 expired in December 2013 there has been much confusion over the issue of the IRS tax on short sales in California.  Although we do not have a law currently in place defining the forgiveness of Federal Taxes on Short Sales in California for  2014 we do have a documented opinion from the IRS thanks to Senator Barbara Boxer. “The Internal Revenue Service Will Not Penalize California Families … [Read more...]

Federal taxes on short sales forgiven in CA

Federal taxes on short sales are still forgiven. The Mortgage Debt Relief Act of 2007 allowed taxable debt on your federal income tax to be forgiven on a short sale.  Try searching "The Mortgage Debt Forgiveness Act of 2007" on  web sites like Google  ,Yahoo or Bing.   You'll find the The Mortgage Debt Relief act of 2007 has expired. Does that mean you will owe money to the IRS on a short sale? Get the facts. The IRS will not tax you on a short sale in 2014 if you live in … [Read more...]

Foreclosure timeline in California

Foreclosure timeline in CA 280x150

Are you confused about the foreclosure timeline in California? Many homeowners on the Westside, Culver City, Beverly Hills, Westchester and Mar Vista have no idea what kind of timetable they are looking at when facing foreclosure in California. Some think it is one month after the first missed payment while others think it’s much longer. The best method to avoid foreclosure in California is to understand the timeline governed by state law. I created a timeline for non-judicial … [Read more...]

Calif. enacts tax forgiveness on mortgage debt

IRS taxes

If you have suffered a short sale, foreclosure or loan modification, here's some good news: Most taxpayers can now exclude canceled mortgage debt income up to $500,000. The limit is $250,000 for married/registered domestic partner (RDP) individuals filing separately. The California law created by SB 401 now brings us into conformity with the federal debt-forgiveness laws and applies to debt forgiveness in 2009 and through 2012. However, California's limits of qualifying principal residence … [Read more...]

Is Calif. Short Seller debt forgiveness in peril?

Gov. Schwarzenegger vetoed a bill last week which would have been similar to the federal government's tax forgiveness on "phantom debt" for short sellers. His reason for the veto was the bill contained an unrelated provision regarding tax refunds for the state's largest businesses. Gov. Schwarzenegger is supporting the banning of taxation of mortgage debt forgiveness and called for the legislature to send him a bill to provide tax forgiveness before the April 15th tax deadline. According … [Read more...]