mortgage debt forgivenes

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As the fiscal cliff debate raged, the NATIONALAsso-

CIATIONOFREALTORS@was intent on not adding to

the confusion by speculating on what might happen

given one scenario or another. Yet, I can't overstate

how much work was happening behind the scenes

to minimize any potential impact on real estate.

The result was that on Jan. 2, the same day the

House passed the bill to avert the fiscal cliff, we were

providing information to all of our state and local associations-

and to you via REALTOR.org-about

specific provisions of the bill that affected real estate.

While the debate was underway, we felt it was a

good time to reaffirm our support for the mortgage

interest deduction. Although discussions to limit

the MID never progressed to an actual proposal,

we wanted to remind lawmakers that the MID

benefits primarily middle-income families, and 'any

change to it could harm housing and the economy

as a whole. The Dec. 3 Call for Action generated

record levels of response's from REALTORS@Y.ou let

Congress know loud and clear that we'd be vigilant

in opposing any plan that modifies or excludes the

deductibility of mortgage interest.

While the legislation that was signed into law

in January did not affect the MID, its passage represents

a step in a continuing effort by NAR to protect

the ability of American families to own a horne,

The legislation also extended several tax measures

r ".' l' ~ __ .•... L ~__ ~~~ •.•

• Mortgage cancellation relief is extended

for another year. Households that have mort-

, gage debt forgiven by a lender in 2013as a result of

a modification, short sale, or foreclosure will not

have to pay tax on the amount forgiven.

• Mortgage insurance premiums remain

deductible. Tax filers making less than $no,ooo

who pay for mortgage insurance' can deduct the

cost of their premiums on their 2012 and 2013tax

returns.

• IS-year straight-line cost recovery on

leasehold improvements is extended. For

qualified leasehold improvements on commercial

properties, 15-year depreciation is extended

through 2013and made retroactive to cover 2012.

• Energy efficiency tax credit remains in

force. The IO percent tax credit, up to $500,

for home owners who make energy efficiency

improvements to an existing home is extended

through 2013and made retroactive to cover 2012.

Debate will continue in the coming months on longterm

solutions to the issues left unresolved by the fiscal

cliff bill. As Congress addresses those issues and

broader tax reform, you can bet that we'll continue

our vigilance on behalf of REALTORS"

 

 

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