Mortgage Relief Debt Forgivemess Act?
Have you heard of this act? This Act is for helping people in foreclosure on their primary homes or facing a short sale (working with a lender who will accpet less on the principle owed). Once that sale is complete or if you are foreclosed upon, the difference owed is treated as income to the individual and taxed as income creating a double wammy. 1. Loosing your home and 2. paying taxes on income you didn't receive
This "unfairness" has caught the interest of Congressmen. The House says this is not fair. So now we have this new Act getting debated. Hidden within this act is something that could affect all primary homeowners. If this Bill passes it will impact the homeowner's tax free deduction when selling your primary home (up to $500,000 for married couples, filing jointly, and $250,000 for singles). This bill requires a homeowner to live in their home five full years and not the current two years out of the past five, in order to get this tax free money. Shorter periods of occupancy would get prorated.
If this bill passes this could have a heavy impact on the sale of your primary home!
