Real Estate News:
Congress Eyes Retroactive Extension Of Key Mortgage Tax Benefits
Mortgage Debt Forgiveness & Energy-Saving Upgrades CouldReturn
As we reported here in December, as last year ended Congress let several key tax benefits to homeowners expire. These included those allowing for mortgage debt forgiveness and writeoffs for energy-saving improvements and mortgage insurance premiums as well.
Well, it looks like Congress may be about to address this and reinstate the lapsed tax benefits. Sen. Ron Wyden (D-OR), chairman of the Senate Finance Committee, expects to take up an “Extender’s Bill” sometime this spring. Since these expired tax benefits address part of a taxpaying homeowner’s yearly tax bill, the fact that they have actually expired from the code does not necessarily mean they are “lost” to taxpayers for next year’s taxes. If they are brought back, they would be retroactively reinstated to last Jan 1, in which case no taxpayers would feel the effect of the expiration at all … the entire thing becomes an “accounting glitch”.
Here’s a detailed article by Kenneth R. Harney in the Los Angeles Times:
http://latimes.com March 23, 2014, 5:00 a.m.
In December, Congress let some write-offs, including those for mortgage debt forgiveness and energy-saving upgrades, expire. But now there are signs they could be extended … “This is high on [Wyden’s] priority list,” according to a source with direct knowledge of the committee’s plans. That’s an important change from December, when then-Chairman Max Baucus (D-Mont.), who is now ambassador to China, let 50-plus corporate and individual tax benefits expire. The House also took no action to extend them.
Return Of Benefits Not A “Done Deal” As Yet
Though bipartisan support for the mortgage debt portion of this is widespread and solid, there are still hurdles to be overcome. In the House, Ways and Means Committee Chairman Dave Camp (R-MI) says he has no idea when he’ll take up the legislation. He has presented his own tax reform package which included sharp cuts to the benefits homeowners enjoy currently.That’s not a good sign that he’d look favorably on such an “Extender’s Bill”, but the fact that this is an election year will bring sharp pressure to bear on him and others to do something in this regard.