Traditionally, forgiven debt was taxable as an income (aka ‘phantom income’). But the enactment of The Mortgage Forgiveness Debt Relief Act, mortgage-related forgiven debts were exempted from taxation.
The Mortgage Forgiveness Debt Relief Act was passed by Congress in 2007 in an attempt to provide some relief for the millions of homeowners who found themselves owing more on their mortgage than the property was worth as a result of the collapse of the housing and finance industries. --- This Act expired on December 31st, 2013.
Little known in the real estate industry is another tax exemption that has long been in existence and is not going away any time soon. --- It’s just a little more complicated and less straightforward. But for most distressed homeowners, the resulting tax exemption might be the same as the The Mortgage Forgiveness Debt Relief Act.
If you happen to know someone who may be going through mortgage troubles and/or want to learn more about this “other” tax exemption, please feel free to share my contact info with them.
Visit my website, www.CarloDelizo.com, to see what our previous clients are saying about me and my team.
Carlo Delizo, Team Lead & Managing Broker
Platinum Real Estate Marketing Svcs.
Operating under: RE/MAX Metro Realty Inc.
REO Certified Specialist
Certified Distressed Property Expert (CDPE)
Accredited Short Sale Designation
Short Sale & Foreclosure Resource (NAR)
Direct: (425) 444-1010
Fax: (800) 591-0858