The Mortgage Forgiveness Debt Relief Act of 2007

Posted on October 2, 2010

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In a foreclosure, the homeowner has two burdens: First he loses his property, and then also the foreclosure can cause taxable income when the property is sold. Often the fair market value of the foreclosed property is less than the monies owed, including mortgage, taxes, etc.

Even if the debtor returns the property to the mortgage company, or abandons the property altogether, the laws have decreed that this is a sale or exchange under the Internal Revenue Code, and thus the former mortgagor can still be liable for taxes.

However, according to irs.gov (note link below) “The Mortgage Forgiveness Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualify for this relief.

 See Axsmith.net for more details.  Christine Axsmith, Esq. is a Washington, DC – based attorney specializing in foreclosure fraud, illegal foreclosure, real estate fraud.  Her credentials can be viewed at her LinkedIn profile.  The Axsmith Law website has a wealth of information for review related to elder law and foreclosure prevention. 

Other sources of valuable information are the AARP website, the Federal Trade Commission website and the HUD website.  See Axsmith Law web site to speak to an attorney.

www.foreclosure.com
Wikipedia on Foreclosure
HUD Foreclosure Prevention Programs
Foreclosure Houses – Get Your Name Off This List!
Foreclosure Misc
www.washingtonpost.com
www.huffingtonpost.net
www.foreclosure.com
Wikipedia on Foreclosure
HUD Foreclosure Prevention Programs
See more guardianship information at http://www.axsmith.net/Washington_DC_Guardian_Attorney.html

www.axsmith.net
www.cnn.com
www.washingtonpost.com
www.huffingtonpost.net
www.foreclosure.com
Wikipedia on Foreclosure
HUD Foreclosure Prevention Programs
Foreclosure Houses – Get Your Name Off This List!
Foreclosure Misc
www.washingtonpost.com
www.huffingtonpost.net
www.foreclosure.com
Wikipedia on Foreclosure
HUD Foreclosure Prevention Programs
Foreclosure Houses – Get Your Name Off This List!
Foreclosure Misc.

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