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I’ve been asked a lot lately about the Mortgage Forgiveness Debt Relief Act which is due to expire December 31, 2013. This act provides homeowners with cancellation of debt, huge tax relief.

Learn more about the Mortgage Forgiveness Debt Relief Act and Debt Cancellation from the IRS website.

This 2007 Act has been extended one year already from 2012 to 2013. We are all hoping it will be extended at least one more year into 2014, but we are uncertain when and if this will happen. The last extension wasn’t announced until January 2, 2013.  Fingers are crossed, but we need a plan…

Here are the bills that would cause this act to be extended:

H.R. 2788: Mortgage Forgiveness Tax Relief Act

Introduced: Jul 23, 2013

Sponsor: Rep. Joseph Heck [R-NV3]

Status: Referred to Committee Mortgage Forgiveness Tax Relief Act – Amends the Internal Revenue Code to extend through 2015 the exclusion from gross income of income attributable to the discharge of indebtedness on a principal residence.

H.R. 2994: Mortgage Forgiveness Tax Relief Act of 2013

Introduced: Aug 02, 2013

Sponsor: Rep. Tom Reed II [R-NY23]

Status: Referred to Committee

Status: This bill was assigned to a congressional committee on August 2, 2013, which will consider it before possibly sending it on to the House or Senate as a whole.Mortgage Forgiveness Tax Relief Act of 2013 – Amends the Internal Revenue Code to extend through 2014 the exclusion from gross income of income attributable to the discharge of indebtedness on a principal residence.

In the meantime… between NOW and the End of the Year…

You should consider the possibility that the Mortgage Forgiveness Debt Relief Act will not be extended past the end of 2013 and as a result, we would recommend you recommend to your short sale owners in default to move quickly on selling their home now, and push to close by December 31, 2013.

I’ll be talking more about this and how to get owners in default, whether they are short sales or equity sales, to get motivated to take action, and sell to you… at wholesale prices, so you can buy, fix and sell for profit… an endless supply of deals. Find out the details in my Free New Foreclosure Investor Webinar, Wednesday, November 13th, 6pm Pacific, 9pm Eastern. Register Here and then Join Me!