Stanislaus County Short Sales - The Clock is Ticking!!
Back in the old time Stanislaus County Short Sale Days, way back in 2006 things were a bit different.Â Â Doing aÂ Stanislaus County Short Sale back in those dark days could possibly leave you with a big tax bill.Â Back then if you did a successful short sale, which were much rarer then, the amount of forgiven debt could actually be considered "income".Â Huh? Really?Â
Let me explain.Â Â Let's say you owed $150,000 on your Stanislaus County home but it was only worth $100,000.Â When you sell it in a Stanislaus County Short Sale for $100,000 you still "owe" the bank $50,000.Â (Actually it would be more than that but just to keep things simple lets use the $50,000 figure)Â That $50,000 is the amount that the bank has "forgiven".Â Â So what did Uncle Sam do about that $50,000?Â They had the bank send you IRS Form 1099 claiming that the $50,000 was income.Â You would then have to claim an extra $50,000 "income" on that years tax return.Â Now that just made all kinds of sense didn't it?Â
So after much complaining and outrage our elected officials got together and passed the Mortgage Debt Relief Act of 2007.Â What this did was to allow you to exclude as income the amount of forgiven debt from a short sale in MOST cases.Â Now the catch is that this applies to debt forgiven in calendar years 2007 through 2012. Â I know we are only 2 months into 2012 but the Clock is Ticking.Â We have about 10 months left in this year and sometimes a Stanislaus County Short Sale can take a while to close.Â I just had one that took 7 months and I have heard of longer ones.Â So as it stands right now the Mortgage Debt Relief Act of 2007 will expire in a little over 10 months.Â
Now of course there is always the possibility that the Mortgage Debt Relief Act of 2007
could be extended past the end of 2012, especially since this is an
election year.Â As of today I haven't heard any rumblings about that
happening, of course it is still early.Â Â So my advice to you is that if
you are thinking about doing a Stanislaus County Short Sale you might want to think about getting things started sooner rather than later.Â
Give me, Jim Patton, a call at 209-633-2839 and I will be happy to discuss your options with you.Â I have helped many families out of a difficult situation by helping them with a Stanislaus County Short Sale.Â Don't forget the Clock is Ticking. Â
Tick Tock, Tick Tock...
Jim Patton - Realtor, Short Sale Specialist, CDPE
Century 21 M&M and Associates
The author of this blog, Jim Patton, is a full time Realtor with Century 21 M&M and Associates.Â Jim is a Central California Short Sale Specialist who lists and successfully sells short sales throughout Stanislaus, Merced and San Joaquin counties. Call Jim Patton at 209-633-2839.
The views expressed herein are Jim Patton's personal views and do not reflect the views of Century 21M&M and Associates