Syndicated columnist, Ken Harney discusses the hazards the "Fiscal Cliff" poses to underwater homeowners. The Mortgage Forgiveness Debt Relief Act is set to expire Dec. 31, 2012. The law, dating to 2007, "temporarily amended the federal tax code to allow mortgage debt on a principal home that is canceled by a lender through loan modification, short sale or foreclosure to escape taxation as ordinary income." in other words, if the law is not extended into the new year, the forgiven debt after a shortsale, occuring after 2012, would face federal taxation. For the full article, go here.
Posted on December 16, 2012 at 8:23 am Ricardo Romagosa