Archive for Mortgages
No More Tax On Forgiveness Of Debt In California
Posted by: | CommentsNO MORE STATE TAX ON FORGIVEN DEBT
Distressed homeowners no longer have to pay California state income tax on debt forgiven in a short sale, foreclosure, or loan modification. Enacted into law yesterday, Senate Bill 401 generally aligns California’s tax treatment of mortgage debt relief income with federal law. For debt forgiven on a loan secured by a “qualified principal residence,” borrowers will now be exempt from both federal and state income tax consequences. The existing federal exemption is for indebtedness up to $2 million, whereas the new California exemption is for indebtedness up to $800,000 and forgiven debt up to $500,000.
“Qualified principal residence” indebtedness 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.
The tax breaks apply to debts discharged from 2009 through 2012. Californians who have already filed their 2009 tax returns may claim the exemption by filing a Form 540X amendment.
Taxpayers who do not qualify for the above exemptions (e.g., second home or rental property) may nevertheless be exempt under other provisions. Most notably, taxpayers who are bankrupt are exempt from debt relief income tax. Also, taxpayers who are insolvent are exempt from debt relief income tax to the extent their current liabilities exceed current assets.
For more information about mortgage forgiveness tax consequences, go to California Franchise Tax Board’s Mortgage Forgiveness Debt Relief Extended webpage and the Internal Revenue Service’s Mortgage Forgiveness Debt Relief Act and Debt Cancellation webpage. The full text of Senate Bill 401 is available at www.leginfo.ca.gov.
Brought to you by the California Association Of Realtors
Leon C. Williams Certified Foreclosure Specialist Pre-Foreclosure Coach leon@williamslandmark.com Leonsblog Sacramento Short Sale Guru Sacramento Pre-foreclosure Workshop Williams Landmark Real Estate
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Understanding Condos And PUD Ownership
Posted by: | CommentsUnderstanding Condominum and PUD Ownership
California’s builders, in an effort to combat the dual problem of an increasing population and a declining availability of prime land, are increasingly turning to common interest developments (CIDs) as a means to maximize land use and offer homebuyers convenient, affordable housing.
The two most common forms of common interest developments in California are Condominiums and Planned Developments, often referred to as PUDs. The essential characteristics shared by these two forms of ownership are:
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How To Not To Turn $20 Into A $75,000 Disaster!
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War On Wealth Series – Wealth Preservation
This is What Happens When You Don’t Use “Total Asset Optimization Principles”
Anyone With A Job Can Build A Nest Egg On “Steroids”
Whether your financial status is considered lower income, middle income, upper income, or super rich you have the ability to grow a nest egg on “steroids”. It’s the system that you put in place that determines if you will be the “robbing Peter to pay Paul” person in life or the “everything seems to fall in your lap” person. The choice is yours.
Root of All Evil
To understand how “NOT” to turn $20 into a $75,000 disaster I have to first lay some ground work on this “thing” called “Total Asset Optimization”. Let’s begin this discussion by emphatically stating, I Believe the lack of “Total Asset Optimization” is one of the largest contributors to strife in American Society. I believe passionately that the lack of knowledge and ability to grow in our financial lives causes many “ills” for the American people. Gang Violence, hatred and intolerance, divorce and the subsequent breakup of the family unit, road rage, jealously and a host of problems stems from our inability to prosper not only financially, but in all areas of our lives, and is rooted in our self-worth or lack thereof.
“Get Your Financial House In Order And Save The World”
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