Community Corner
Mortgage Forgiveness Debt Relief Act Extended
If you sell a home at a loss, you will not have to pay taxes on the difference.
As part of the "fiscal cliff" vote, the Mortgage Forgiveness Debt Relief Act is being extended.
What this simply means is that when a struggling homeowner sells their home for $75,000 and they owe $150,000, they are not taxed on the $75,000 that the bank had to write off. This is good news for homeowners that are struggling.
Other homeowner benefit extensions include being able to deduct your private mortgage insurance for those who make less than $110,000 a year. This is retroactive back to 2012 and includes 2013.
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A tax credit of up to $500 is available to homeowners who made energy improvements to their home in 2012. This is also available in 2013.
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