In mid-December 2015, Congress passed a law extending the Mortgage Forgiveness Debt Relief Act of 2007, retroactively, for all of 2015 through the end of 2016.
This act prevents a borrower from being taxed on any mortgage debt forgiven on a short sale or foreclosure. Prior to the implementation of this act, any shortfall on the payoff of a mortgage was taxed as income to the borrower.
The limit on forgiveness is $2 Million and the mortgage had to be secured by the borrower's primary residence. If you had any mortgage debt forgiven in 2015, consult a tax professional with any questions.
Please contact me at BarkerLoans@gmail.com or 708.473.7688 with any mortgage-related questions.
