PRLog - Jan. 8, 2014 - LAS VEGAS -- In 2007, Congress passed the Mortgage Forgiveness Debt Relief Act to help people who were down on their luck financially because of the loss of their homes. The tax break was supposed to end in 2009; however, it was extended through Dec. 31, 2013 because many people still needed help. As of today, Congress has allowed the Mortgage Forgiveness Act to expire, even though some states hardest hit by the housing crisis (such as Nevada) are still seeing high foreclosure rates.
Las Vegas Top Realtors - The Myers Team
Many people have argued that the Mortgage Relief Act should be extended once again; however, it is unclear if this will be happening anytime soon. The big question we are being asked is, "Will I have to pay taxes on the forgiven amount?"
While we are not CPA's nor qualified to provide tax advice, the fact remains that we have worked with hundreds and hundreds of homeowners who have successfully completed short sale transactions. Many past clients have informed us that they were able to get around owing taxes on their forgiven debt by qualifying for what’s called the "insolvency exclusion." You may not have to include forgiven debts as income if you can show that your total liabilities exceed your total assets.
Most banks will only approve a short sale once they have determined that a "hardship situation" exists. Many of these hardship scenarios may also qualify for insolvency. Once again, the above is not intended as tax advice; however, there are provisions in the IRS tax code which may provide the same protections as were allowed under the Mortgage Forgiveness Debt Relief Act. There is still hope!!!
The Myers Team with Simply Vegas Real Estate is nationally recognized as one of the most influential figures in real estate today. From January 1, 2007 through December 31, 2012, The Myers Team closed more short sale transactions than any non-lawyer affiliated Realtor or Broker in Las Vegas. The Myers Team handles traditional Real Estate transactions, in addition to their highly successful short sale division.
To contact The Myers Team, visit http://www.NevadaShortSaleInfo.com
For traditional sales (non-short sales) visit http://www.LasVegasList4Less.com
The Myers Team
The Myers Team