Key Largo Title Lawyer Happy To Report The Mortgage Debt Relief Act Extended One Year
The Mortgage Debt Relief Act of 2007 has been extended for one year. This is very good news for Florida homeowners trying to obtain short sales. Usually cancelled debt is considered income, but a provision of the Debt Relief Act allowed borrowers “to exclude certain cancelled debt on [a] principal residence from income. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.” The Act was set to expire on January 1, 2013, but has now been extended until January 1, 2014.
Here is the text from H.R.8:
SEC. 202. EXTENSION OF EXCLUSION FROM GROSS INCOME OF DISCHARGE OF QUALIFIED PRINCIPAL RESIDENCE INDEBTEDNESS.
(a) IN GENERAL.—Subparagraph (E) of section 108(a)(1) is amended by striking ‘‘January 1, 2013’’ and inserting ‘‘January 1, 2014’’.
(b) EFFECTIVE DATE.—The amendment made by this section shall apply to indebtedness discharged after December 31, 2012.
As a Coral Springs real estate attorney, I have seen first-hand how effective short sales can be for underwater homeowners. Short sales have become an essential tool for homeowners across South Florida and the Florida Keys. The extension of the Act will allow homeownersor primary residences to avoid tax liability as a result of these sales and allow the housing market to continue on its path towards recovery.
The Key Largo title company of the Law Offices of Erik S. Bloom, P.A. has closed thousands of purchase and refinance transactions throughout the State of Florida on behalf of real estate and mortgage professionals, including short sales and foreclosures. Our Islamorada real estate lawyers provide the highest level of professional services available in the title industry. Call our firm today at (954) 603-0550 in Broward and (305) 290-0690 in the Florida Keys and Miami-Dade County. You can also email the firm at [email protected]// .
