Discussion:No Tax on Foreclosures

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Discussion Forum Index --> Tax Questions --> No Tax on Foreclosures

Deback (talk|edits) said:

December 16, 2007
http://www.lsj.com/apps/pbcs.dll/article?AID=/20071215/NEWS01/712150323/1001/news

Death&Taxes (talk|edits) said:

16 December 2007
Welcome back Deb! Is this the same bill that might cause problems for those selling mixed use residences?

Gmikeg (talk|edits) said:

16 December 2007
Thanks Deb!

DZCPA (talk|edits) said:

16 December 2007
Debt forgiveness is generally not taxable if taxpayer is insolvent. This will apply to most taxpayers that lose their homes.

Solomon (talk|edits) said:

18 December 2007
From the Mortgage Debt Relief Act:

SEC. 7. APPLICATION OF JOINT RETURN LIMITATION FOR CAPITAL GAINS EXCLUSION TO CERTAIN POST-MARRIAGE SALES OF PRINCIPAL RESIDENCES BY SURVIVING SPOUSES.

     (a) Sale Within 2 Years of Spouse's Death- Section 121(b) of the Internal Revenue Code of 1986 (relating to limitations) is amended by adding at the end the following new paragraph:
           `(4) SPECIAL RULE FOR CERTAIN SALES BY SURVIVING SPOUSES- In the case of a sale or exchange of property by an unmarried individual whose spouse is deceased on the date of such sale, paragraph (1) shall be applied by substituting `$500,000' for `$250,000' if such sale occurs not later than 2 years after the date of death of such spouse and the requirements of paragraph (2)(A) were met immediately before such date of death.'.
     (b) Effective Date- The amendment made by this section shall apply to sales or exchanges after December 31, 2007.

Yes, DT, it does address mixed use - soon to be law. Probably need to wait on the JCT technical explanation because the Senate made a slew of amendments to the original HR 3648.

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