The Mortgage Forgiveness Debt Relief Act of 2007 was extended to Dec. 31, 2013. This law allows affected taxpayers to exclude income from the discharge of debt on their principal residence as a result of a debt cancellation. Learn more
IRS announces guidance on the principal reduction alternative offered in the Home Affordable Modification Program (HAMP).
The guidance affects homeowners who obtained a qualified home loan modification with a principal reduction on transactions conducted before Jan. 1, 2014. Borrowers are encouraged to talk with a licensed tax consultant. The guidance can be found here.