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Sunday, September 18, 2011

Mortgage Cancellation of Debt Tax Relief

The Mortgage Relief Act , which effects debts discharged on or after Jan 1, 2007 and before Jan. 1, 2013, generally allows taxpayers to exclude up to $2 million per married couple of mortgage debt forgiveness on their principal residence (does not include second homes or income property).

Many people discover to their dismay that when a loan debt is forgiven by a lender, not only can this impact a credit report, it can result in additional taxes. This provision provides some relief.

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1 comment:

  1. Similar things could happen now. Many smart people think that the most important thing the government can due in the face of the "debt crisis" and economic slump is to simplify the tax code.