The Mortgage Forgiveness Debt Relief Act applies to homeowners who are NOT insolvent on the date of the sale.
The internal revenue code has an existing exclusion of forgiven debt from income when the borrower is insolvent on the date of the sale (IRS Publication 4681). this has been an existing part of the tax code for a long time.
Published by BethMannRealEstateLaw
- Illinois Attorney with over 20 years experience.
- My law firm concentrates on Real Estate law primarily REO, short sales and transactional closings.
- ReoMac preferred attorney
- Member of the Illinois Bar, CBA, ISBA and ABA
- Juris Doctorate from John Marshall Law School in 1990.
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