Home > Research Legal Advice > Tax > Hi ishort saled my house last year i do not owe the irs anything.why do ...
Asked about 1 year ago - Attleboro, MA
Flaghouse sold for 174,000 and i owed 164,000 for 90,000 dif now mass is taxing me almost 5000 i am broke i did not make any money off of house...what should i do
In 2007 the federal government enacted the Mortgage Debt Relief Act which has allowed taxpayers to exclude income from the discharge of debt on their principal residence, including balances forgiven by a mortgage lender when they accept a short sale. However, that act applies only to federal income tax, and Massachusetts has not enacted a similar act for state income tax, which is why you may still owe state taxes on the amount forgiven by your lender. You should speak with a tax attorney or accountant as soon as possible to understand your state tax obligations for your short sale.
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