Real Estate News:
Federal Tax Aid For Homeowners May Expire
Can Congress Get It Together To Do Anything By Years End?
As the article here says, it seems we've seen this movie before, and if the recent performance of Congress as a whole ... especially the House ... is any indicator, the real estate news here may not be good. On December 31 of this year, provisions of the law favorable to home owners and buyers regardiing tax treatment of mortgage relief, tax credits for energy improvements, and some buyers' insurance premium write-offs, may all expire.
California home sellers will be exempt from the worst of these expirations, which may see homeowners selling through short sale transactions and waiting for their excrow to close, surprised. If the current extensions to certain laws expire and their escrows don't close by Dec 31, they may see the amount of their loans the lenders are writing off in their Short Sales be termed Taxable Income by the IRS. Californians are protected from this by a state law passed to head this off, but folks in most other states are not similarly protected. And, the provisions that could expire regarding energy efficient improvements and premium write-offs would hit here in Californiia as hard as anywhere else.
Here's an article by Kenneth R. Harney in the L.A. Times that explains the whole thing:
WASHINGTON — Haven't we seen this movie before? On Capitol Hill for the second year in a row, key federal tax assistance for homeowners is heading for expiration within weeks. And there's no sign that Congress plans — or has the minimal political will — to do anything about it.
Will Congress Play The Grinch this Holiday?
In reading the article, there doesn't seem to be much discussion of this at all in Washington. One of the brighter points of our struggling but slowly rebounding economy is the real estate market. Southern California is doing fairly well in that respect. Will Congress find the Holiday Spirit and support our homeowners and sellers by doing what it takes to keep things as they are? Or will Congress continue in the same way it has lately ... and decide to play the Grinch this year by doiig nothing?
Expectations here are not high, but watch this space.