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Home Buyer Federal Tax Credit Ending April 30 (Video)

Tags: home buyer, san diego, tax credit

California Debt Relief Extended for Distressed Homeowners

Senate Bill 401, which was signed into law on April 12, provides help for distressed homeowners by waiving their California state income tax owed on debt forgiven in a foreclosure, short sale or loan modification.  This news will help many during this tax season as it could mean the difference between owing money and getting a state tax refund.  This law mirrors the federal exemption, but is different in that the federal is for indebtedness up to $2 million and the state is for indebtedness up to $800,000 and forgiven debt up to $500,000.

As we do not give tax and/or legal advice, it is important to contact an accountant or real estate attorney to determine whether you qualify.  The basics, however, as stated by the California Association of Realtors are that this bill is for debt forgiven on a loan secured by a “qualified principal residence.”  What is debt on a “qualified principal residence?”  It is defined as, “debt incurred in acquiring, constructing, or substantially improving a principal residence.  It includes both first and second trust deeds.  It also includes a refinance loan to the extent the funds were used to payoff a previous loan that would have qualified.”  These tax breaks will continue for three years as they “apply to debts discharged from 2009 through 2012.” Read the rest of this entry »

Tags: debt relief, distressed, home owner