Dayton Ohio Real Estate and Mortgages Information

Need to Stop Foreclosure… Now what about the taxes?

I am asked all the time by clients and homeowners facing foreclosure or are in pre foreclosure in the Dayton Ohio area several questions:

• How do I Stop Foreclosure in Dayton Ohio?
• How do I avoid Foreclosure in Dayton Ohio?
• What is a Short Sale and how can that stop foreclosure?
• I need Short Sale Help, where do I turn?
• What is the difference between pre foreclosure and foreclosure?
• Where can I find foreclosure help?
• If I sell as a Short Sale what happens to me with taxes?
• How do I know if my agent knows how to do a short sale?

For this article, lets focus on the tax issue with short sales.  I get that question from almost every client I meet with.  “How will a Short Sale Help and what about the taxes?”  Lets review that.

Short Sale Help and your Taxes…

With the The Mortgage Forgiveness Debt Relief Act of 2007 there is a good chance you will not owe taxes as a result of stopping foreclosure with a short sale.  Always check with your accountant on your specific situation.  The basics of the new law are:

1. Debt forgiven from 1/1/2007 to 12/31/2009
2. Must have been your principle residence
3. The principle balance of the loan must be less than $2,000,000 for a married couple…not a problem most Dayton Ohio real estate owners have to deal with.

Read here for recent news directly from the IRS on this topic: Mortgage Workouts, Now Tax-Free for Many Homeowners

Short Sale Help tips.