Real Estate News – Extended Mortgage Debt Relief Act, PMI Tax Relief and Capital Gains Tax Rates



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Now that we are well into 2013, there will be some changes to our real estate outlook with some familiar programs back in action. With all the talk about the impending Fiscal Cliff, it is no wonder that homeowners everywhere are wondering how the outcome will impact them individually.

But first, we want to congratulate our lucky friends from Facebook that have won some exciting prizes in our latest drawing! We hope you have a great time enjoying your prizes and we appreciate your support, keeping up to date with us on Facebook!

Now, back to the latest and great news in real estate. Here are three recent changes and/or updates to the programs available out there that will have a significant impact on our marketplace this year and moving forward. This is good, folks!

Mortgage Debt Forgiveness Act Extended Through 2013
On the minds of many homeowners that have mortgages falling short of the current value of their homes, the Mortgage Debt Forgiveness Relief Act was set to expire on December 31, 2012. Among the many issues discussed within Congress during the last few hours of 2012 was the extension period of this important tax relief for distressed homeowners. Primarily as a means to help consumers faced with hardships overcome their financial difficulties when they incur forgiven debt – the Act serves to waive tax implications on what otherwise would be considered taxable income.

Private Mortgage Insurance Tax Relief Now Applies to Fiscal Years 2012 and 2013
Each year millions of homeowners look forward to the tax relief that comes with being able to write off their private mortgage insurance premiums. By the end of 2012, no one was sure the American Taxpayer Relief Act of 2012 would be extended to include the coming year. Once again, at the final hours of negotiations the Act was extended through fiscal year 2013 to allow homeowners paying private mortgage insurance to deduct that amount when filing their income taxes.

Capital Gains Tax Rates Increased from 15% to 20%
A topic of confusion for many, the capital gains tax increase set for higher income levels is more lenient than most people realize. Though the theory is that this increase in tax impacts individuals and households with higher income levels, the truth is the income and gains cap is relatively high. The capital gains tax increase will only apply to individuals earning an Adjusted Gross Income of $400,000 or more. Furthermore, people in these income brackets will incur the capital gains tax only on income earned above and beyond the cap which is $250,000 or more for individuals and $500,000 or higher for households. 
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If you would like to discuss these or any other issues in the real estate marketplace or if you are considering buying or selling a home – contact us today! We would love to help make your real estate dreams become a reality!

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