Thousands of northeast Ohio homeowners, financially distressed and facing foreclosure, could now owe income taxes on loan modifications made to save their homes.
According to U.S. Sen. Sherrod Brown (D-OH), that will be the outcome if Congress does not extend a special tax provision which expired at the end of 2013.
Brown urged immediate action on the Mortgage Forgiveness Tax Relief Act which would continue to exempt principal reductions received through loan modifications or short sales from personal income tax liability.
"This doesn't need to be a permanent tax break," said Brown. "But it needs to exist now."
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