The Mortgage Debt Forgiveness Relief Act has been extended for two years. This really will be helpful to many individuals who were thinking about selling their underwater primary residences and trying to avoid taking a tax hit.
We now have a two-year extension that looks like it is going to be approved and signed into law. That extension covers all of 2015 and 2016. Part of the reason for this year’s delay was the resignation of former Speaker of the House John Boehner and his replacement by Paul Ryan. This put a new individual, Congressman Brady, in charge of the House Ways and Means Committee that had jurisdiction over this particular important tax proposal as well as many other important tax proposals.
The National Real Estate Investors Association has been diligently working on this project through John Grant, National REIA’s lobbyist in Washington, DC. Some of the things National REIA did in order to get this legislation enacted included getting articles published much earlier this year in influential Washington newspapers in order to gain more support. Within a few days of getting an article published in Roll Call magazine, we were able to accumulate another 41 bipartisan sponsors of the House legislation.
At the same time, National REIA’s lobbyist was working with a number of key senators from both sides of the aisle on getting this extension for a minimum of two years. It was this strength in the U.S. Senate which National REIA built that ultimately convinced the House to go with a two-year extension instead of just a one-year extension.
Why is this important? It will help the real estate economy. It helps underwater homeowners.