Compare Listings

Short Sale Homeowners Get a Tax Break in 2013

When Congress voted to avoid the “fiscal cliff” and extend the Bush Tax Cuts for 98% of Americans, they also included a provision that extends the Mortgage Forgiveness Debt Relief Act through 2013.

This is another tax break for homeowners who choose to take a Short sale approach and sell their home for less than they owe to the lender (with prior lender approval.) Without this extension, homeowners would have to add the difference between what they owe and what they sell their home for to their 2013 taxable income. That is a huge win for anyone choosing to do a Short Sale and getting out from under their mortgage.

Without the Mortgage Forgiveness Debt Relief Act extension, a homeowner who owes $150,000 on the mortgage and short sells the home with lender approval for $100,000, would have had to include the $50,000 difference as income in their income tax return for 2013.

Struggling homeowners who are considering a short sale or loan modification will continue to be eligible for this tax relief through Dec. 31 2013.

img

Sean Roque

Related posts

Five keys to success when buying a home in a sellers market

There is no doubt that we are in a Real Estate sellers market. Many sellers are getting multiple...

Continue reading
by Sean Roque

Buying or building a new home? Hire a Buyer’s agent to represent you or be prepared to pay more for it.

I can’t begin to tell you how many people I know that have told me how they wish they would have...

Continue reading
by Sean Roque

When is the best time to sell a home in the Kansas City Metro area?

Simple answer; NOW There are many reasons why I can say this without hesitation, and there are...

Continue reading
by Sean Roque