In previous posts, we’ve discussed the tax benefits derived from the Mortgage Forgiveness Debt Relief Act, first enacted in 2007 and extended in 2009. This act waived the taxes incurred by a foreclosure or short sale. The difference between what a house sells for and what is owed on the mortgage is considered forgiven debt and a taxable event. Currently, this tax is waived on the foreclosure or short sale of a primary residence on a purchase money loan. The act expires at the end of this year. While it may be extended, right now we have no idea what will happen. If you are considering a short sale, now may be the time to get more information and see if this is the right decision for you. Contact us at LasVegasHomeSpecialist for additional information.