If you’ve been discussing tax relief options with your Santa Monica short sale agent, they’ve no doubt told you about the Mortgage Forgiveness Debt Relief Act of 2007. If you’re not yet working with a Santa Monica short sale agent but have considered a short sale and are look for tax relief, now is the time to do so to take advantage of the MFDRA.
The Mortgage Forgiveness Debt Relief Act was put in place in 2007 to provide tax relief to homeowners that completed a short sale or foreclosure on their home explains one Santa Monica short sale agent. It has been renewed a few different times by Congress as thousands of homeowners have been able to take advantage of this program and save thousands of dollars. Currently there is no talk of renewing the program at the end of 2013 so if you have yet to contact a Santa Monica short sale agent we encourage you to do so because time may be running out.
When you complete a short sale on your home, Santa Monica short sale agents explain that the IRS views the forgiven amount as taxable income; this makes the homeowner liable to pay taxes the following year on the forgiven debt. If your lender forgives you $20,000 in a short sale would you want to pay taxes on that? The Mortgage Forgiveness Debt Relief Act is available to all homeowners that complete a short sale on their primary residence and have their forgiven amount below a certain threshold.
To find out more information about the Mortgage Forgiveness Debt Relief Act of 2007, to see if you qualify or to get the process of listing your home as a short sale started, reach out for help and information from a Santa Monica short sale agent today. Time may be running out so don’t delay any longer!