Will I pay taxes on my short sale?

Here is a great article that gives the basic nuts and bolts about debt forgiveness and the taxes associated with short sales.

What You Need to Know about Cancellation of Mortgage Debt

Will I pay taxes on my short sale?By Linda Goold -RISMEDIA, Monday, March 12, 2012— This column is brought to you by the NAR Real Estate Services group

A lender will, on occasion, forgive some portion of a borrower’s debt. The general tax rule that applies to any debt forgiveness is that the amount forgiven is treated as taxable income to the borrower. Some exceptions to this rule are available, but, until recently, the borrower was required to pay tax on the debt forgiven. A new law enacted in December 2007 provides relief to troubled borrowers when some portion of mortgage debt is forgiven. However, this relief expires on December 31, 2012 and NAR will be working to obtain an opens in a new window(read more)

Leave a Reply

This site uses Akismet to reduce spam. opens in a new windowLearn how your comment data is processed.

Compare listings

Call Now ButtonCall Aaron Zapataopens phone dialer