Solutions to tax forgiveness on short sales

short sale sign: forgiveness tax relief

Los Angeles property owners facing foreclosure are concerned about tax forgiveness on short sales. Homeowners who are concerned about their future do all they can avoid foreclosure. Fortunately for some, California has special provisions for those facing foreclosure. In preparing for a short sale, the sellers often ask: Are there exemptions from the taxation of cancellation of debt income? According to the California Association of Realtors, there are four circumstances under which the … [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...]

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...]

First Time Homebuyer Credit ending in April!

First Time Homebuyer Credit is close to the end of Congress Extension. Home buyers!! It is time to stop sitting on the fence and make your purchase in order to take advantage of the first time home buyers tax credit. Basic Facts: Must purchase by April 30, 2010 Must close by June 30, 2010 First-Time Home Buyer Tax Credit of up to a maximum of $8,000 Current Home Owners Tax Credit of up to a maximum of $6,500 Both require purchasing a home between November 7, 2009 and … [Read more...]