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Short Sale in 2014? No "Debt Forgiveness" Tax Worries

In  general, tax law identifies the difference between what a borrower owes and what a borrower actually pays to the bank in a foreclosure or short sale as taxable income. This can be a nightmare for already cash-strapped sellers. There is good news, though.

As a result of recently passed legislation, sellers won't pay tax on any mortgage debt forgiven or cancelled by a lender in a short sale, foreclosure or loan modification in 2014.

 

 

 

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