The real estate industry let out a sigh of relief when Congress announced the Fiscal Cliff deal that took effect on January 1st. The deal extends tax breaks and includes deductions that are beneficial to homeowners across the country. The bill passed the House of Representatives with a 259-167 vote averting tax hikes and another impending recession.
Under the H.R.8 legislation the Mortgage Debt Relief Act has been extended through the rest of 2013. This means that distressed homeowners will not have to pay taxes on the forgiven debt of cancelled mortgages following loan modifications or short sales. This is a huge financial relief for owners experiencing short sales that would have chosen to go into foreclosure or bankruptcy had it not been extended.
There is also a deduction for Mortgage Insurance Premiums for homeowners with private mortgage insurance, FHA, VA, low down payment loans and with a gross income of $110,000 or less. These deductions can be written off on federal tax returns along with mortgage interest. (Inman News) Another provision is a 10% tax credit (up to $500) for energy efficient home improvements as well as tax credits to builders and contractors on the construction of new homes that meet specific environmental codes. (National Association of Realtors)
In addition, Capital Gains taxes will increase to 20% for individuals with a gross income of $400,000 and joint incomes of $450,000 or higher, to be paid on the sale of real estate assets, stocks, etc. (MSNBC) The real estate industry came out a winner in the final fiscal cliff negotiations, but it's not unlikely that other tax issues and changes will arise later this year.
The real estate industry let out a sigh of relief when Congress announced the Fiscal Cliff deal that took effect on January 1st. The deal extends tax breaks and includes deductions that are beneficial to homeowners across the country. The bill passed the House of Representatives with a 259-167 vote averting tax hikes and another impending recession.
Under the H.R.8 legislation the Mortgage Debt Relief Act has been extended through the rest of 2013. This means that distressed homeowners will not have to pay taxes on the forgiven debt of cancelled mortgages following loan modifications or short sales. This is a huge financial relief for owners experiencing short sales that would have chosen to go into foreclosure or bankruptcy had it not been extended.
There is also a deduction for Mortgage Insurance Premiums for homeowners with private mortgage insurance, FHA, VA, low down payment loans and with a gross income of $110,000 or less. These deductions can be written off on federal tax returns along with mortgage interest. (Inman News)
Another provision is a 10% tax credit (up to $500) for energy efficient home improvements as well as tax credits to builders and contractors on the construction of new homes that meet specific environmental codes. (National Association of Realtors)
In addition, Capital Gains taxes will increase to 20% for individuals with a gross income of $400,000 and joint incomes of $450,000 or higher, to be paid on the sale of real estate assets, stocks, etc. (MSNBC)
The real estate industry came out a winner in the final fiscal cliff negotiations, but it's not unlikely that other tax issues and changes will arise later this year.
The real estate industry let out a sigh of relief when Congress announced the Fiscal Cliff deal that took effect on January 1st. The deal extends tax breaks and includes deductions that are beneficial to homeowners across the country. The bill passed the House of Representatives with a 259-167 vote averting tax hikes and another impending recession.
Under the H.R.8 legislation the Mortgage Debt Relief Act has been extended through the rest of 2013. This means that distressed homeowners will not have to pay taxes on the forgiven debt of cancelled mortgages following loan modifications or short sales. This is a huge financial relief for owners experiencing short sales that would have chosen to go into foreclosure or bankruptcy had it not been extended.
There is also a deduction for Mortgage Insurance Premiums for homeowners with private mortgage insurance, FHA, VA, low down payment loans and with a gross income of $110,000 or less. These deductions can be written off on federal tax returns along with mortgage interest. (Inman News)
Another provision is a 10% tax credit (up to $500) for energy efficient home improvements as well as tax credits to builders and contractors on the construction of new homes that meet specific environmental codes. (National Association of Realtors)
In addition, Capital Gains taxes will increase to 20% for individuals with a gross income of $400,000 and joint incomes of $450,000 or higher, to be paid on the sale of real estate assets, stocks, etc. (MSNBC)
The real estate industry came out a winner in the final fiscal cliff negotiations, but it's not unlikely that other tax issues and changes will arise later this year.
The real estate industry let out a sigh of relief when Congress announced the Fiscal Cliff deal that took effect on January 1st. The deal extends tax breaks and includes deductions that are beneficial to homeowners across the country. The bill passed the House of Representatives with a 259-167 vote averting tax hikes and another impending recession.
Under the H.R.8 legislation the Mortgage Debt Relief Act has been extended through the rest of 2013. This means that distressed homeowners will not have to pay taxes on the forgiven debt of cancelled mortgages following loan modifications or short sales. This is a huge financial relief for owners experiencing short sales that would have chosen o go into foreclosure or bankruptcy had it not been extended.
There is also a deduction for Mortgage Insurance Premiums for homeowners with private mortgage insurance, FHA, VA, low down payment loans and with a gross income of $110,000 or less. These deductions can be written off on federal tax returns along with mortgage interest. (Inman News)
Another provision is a 10% tax credit (up to $500) for energy efficient home improvements as well as tax credits to builders and contractors on the construction of new homes that meet specific environmental codes. (National Association of Realtors)
In addition, Capital Gains taxes will increase to 20% for individuals with a gross income of $400,000 and joint incomes of $450,000 or higher, to be paid on the sale of real estate assets, stocks, etc. (MSNBC)
The real estate industry came out a winner in the final fiscal cliff negotiations, but it's not unlikely that other tax issues and changes will arise later this year.
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