H.R. 3648: Mortgage Forgiveness Debt Relief Act of 2007

President Bush signed into law a new measure giving tax breaks to homeowners who have mortgage debt forgiven. Under preexisting law, the debt forgiven by a lender, such as for short sales and refinances, was generally taxable to the borrower as debt discharge income. With the passage of the Mortgage Forgiveness Debt Relief Act of 2007, a taxpayer does not have to pay federal income tax on debt forgiven for a loan secured by a qualified principal residence. This tax break applies to debts discharged from January 1, 2007 to December 31, 2009. Qualified principal residence indebtedness is debt incurred in acquiring, constructing, or substantially improving the residence (up to $2 million for refinances). For purposes of calculating capital gains, any debts discharged excluded from income under the new law must be subtracted from the basis of the taxpayer’s principal residence (but not below zero). However, taxpayers may generally exclude from capital gains income up to $250,000 (or $500,000 for married couples filing jointly) for properties owned and used as their principal residence for at least two of the last five years. For a copy of the Mortgage Forgiveness Debt Relief Act of 2007, go to http://www.govtrack.us/congress/bill.xpd?bill=h110-3648 With the new tax break for mortgage debt forgiveness law the government is limiting the capital gains exclusion. Currently, an individual could have lived in a principal residence for two years, and sell using the exclusion, move into their vacation home for two years, and sell using the exclusion, with the end result being that you could have a tax free gain of $500,000 THREE TIMES in six years. Now, for properties acquired and used as a second home starting next year, and later converted to principal residence for a time and then sold, only the period when the property was used as a principal residence will count toward the capital-gain-exclusion computation. The amount of the gain that’s proportional to the period when it was not a principal residence would be taxable.

Popularity: 97% [?]

Street Address List Price Beds Baths Bldg SqFt City Lot Size

2059 MANDELAY PL $1,299,000 4 3 3510 San Jose 14810
4170 HORIZON CT $1,088,000 4 3 1/2 2300 San Jose 7052
15651 ON ORBIT DR $999,950 3 2 2175 Saratoga 43560
2271 WOODRANCH RD $885,000 5 3 2449 San Jose 5662
479 THOMPSON AV $855,888 4 2 1488 Mountain View 6500
14683 COLE DR $849,000 4 2 2008 San Jose 9375
3662 SPRINGBROOK AV $825,000 4 2 1902 San Jose 8276
232 BAYLISS DR $799,999 5 3 2347 San Jose 6098
947 SAPPHIRE CT $769,000 4 2 1572 San Jose 6098
2316 STRATFORD DR $768,250 4 3 1670 San Jose 6098
3337 PRADO LN $767,000 5 3 1844 San Jose 6098
4319 PARTRIDGE DR $750,000 4 2 1/2 1960 San Jose 7840
1748 BOWERS AV $739,000 3 2 1/2 1750 Unincorporated 3049
2616 MABURY SQ $730,000 3 3 2100 San Jose 13503
3256 TODD WY $719,000 3 2 1260 San Jose 6534
2797 BABE RUTH DR $718,000 3 2 1298 San Jose 5663
1007 WOODBOROUGH CT $710,000 4 3 1836 San Jose 4356
598 MADRONE AV $699,888 4 2 1933 Sunnyvale 6000
1410 PEREGRINE DR $699,500 5 2 1/2 2355 Gilroy 6534
17605 SERENE DR $695,000 3 2 1/2 1766 Morgan Hill 4356
716 SAN VICENTE DR $689,000 3 2 1649 Morgan Hill 3920
1776 BARCELONA AV $680,000 4 2 1607 San Jose 6969
632 N 20TH ST $660,000 3 2 1200 San Jose 5227
3001 YANCY DR $645,000 3 2 1310 San Jose 5662
609 PINE AV $640,000 3 1 1/2 1132 Sunnyvale 5227
379 GREENLAKE DR $639,000 3 2 1108 Sunnyvale 4356
562 N 11TH ST $634,000 4 2 1459 San Jose 5662
11 S TERRACE CT $630,000 4 2 1355 San Jose 4791
1580 PINEWOOD WY $630,000 3 2 1044 Milpitas 4800
3159 E ROCKY MOUNTAIN DR $630,000 3 2 1040 San Jose 4792
2375 PENTLAND WY $629,950 4 2 1476 San Jose 6098
514 CALERO AV $629,900 4 2 1345 San Jose 6098
245 HAZEN ST $628,888 3 1 1/2 1064 Milpitas 5662
394 MAT AV $625,000 3 2 1512 San Jose 10018
490 SOUTHSIDE DR $625,000 4 2 1241 San Jose 4791
3255 WHITEROSE DR $620,000 3 2 1078 San Jose 5227
220 BUTLER ST $619,000 3 2 1116 Milpitas 7840
2209 TIARA DR $599,999 4 3 1696 San Jose 5662
17673 PEAK AV $599,900 4 2 1754 Morgan Hill 6970
404 BIXBY DR $599,000 4 2 1158 Milpitas 6098
3133 BARLETTA LN $595,000 4 2 1234 San Jose 8276
362 N 33RD ST $590,000 3 2 1092 San Jose 6098
940 MCCREERY AV $590,000 3 2 1240 San Jose 5662
1180 CRESTON LN $590,000 4 2 1368 San Jose 5700
268 SUNNYSLOPE AV $590,000 4 3 1932 San Jose 6534
151 S CLAREMONT AV $589,950 3 1 1/2 1457 San Jose 6534
1561 FIRESTONE LP $589,950 3 2 1/2 1338 San Jose 2614
7670 WREN AV $589,000 4 2 1839 Gilroy 8276
5727 HILLBRIGHT CI $588,800 3 2 1409 San Jose 5662
77 S 8TH ST $585,000 3 2 1062 San Jose 3484
3157 MOUNT MCKINLEY DR $580,000 3 2 1198 San Jose 5227
807 N 18TH ST $580,000 2 1 1262 San Jose 6098
2813 AKINO CT $579,995 4 2 1415 San Jose 5662
510 BETH DR $575,000 4 2 1241 San Jose 4791
494 HARMONY LN $575,000 3 2 1137 San Jose 4791
2698 KENDRICK CI $570,000 3 2 1444 San Jose 5227
1181 ADRIAN WY $565,000 4 2 1200 San Jose 4792
429 WILLIS AV $559,000 5 3 1442 San Jose 5227
1691 SARALYNN DR $550,000 4 3 1358 San Jose 4791
1617 GREENWOOD WY $550,000 3 2 1190 Milpitas 4792
831 WOODCREEK WY $550,000 4 2 1/2 1504 Gilroy 3049
2350 ELKINS WY $550,000 4 2 1400 San Jose 5662
2949 DURANT AV $549,999 3 2 1204 San Jose 5227
13645 MARMONT WY $549,950 4 2 1056 San Jose 6534
2560 DUMONT CT $549,950 3 2 1176 San Jose 6534
7645 BENASSI DR $549,900 3 2 1388 Gilroy 6534
4156 RIDGEBROOK WY $549,000 4 2 1220 San Jose 5662
166 KAYAK DR $549,000 3 2 1263 San Jose 5227
1820 PERRONE CI $549,000 4 2 1506 San Jose 3484
611 N 15TH ST $549,000 3 2 1352 San Jose 5000
1257 GAINSVILLE AV $545,000 3 2 1073 San Jose 5227
3254 LANTERN CT $535,000 4 2 1346 San Jose 6098
16632 LONE HILL DR $524,999 3 2 1272 Morgan Hill 1742
3003 MARKINGDON AV $500,000 4 2 1188 San Jose 5227
14150 JERILYN DR $499,900 4 2 1350 San Jose 5227
1749 CRUCERO DR $499,000 2 1 872 San Jose 3485
8330 FOREST ST $480,000 3 2 1256 Gilroy 5227
2007 TOBAGO AV $467,000 3 1 1061 San Jose 2613
1437 CHABOT WY $460,000 3 1 1073 San Jose 5662
2399 DAMEY DR $459,000 2 2 933 San Jose 2614

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Popularity: 35% [?]