Congress Includes Real Estate Actions In Fiscal Cliff Bill

The Senate and House of Representatives have included a number of beneficial actions for real estate in the bill signed to avert the fiscal cliff.  Included in the bill are ...

• Mortgage Forgiveness Debt Relief Act.  This act was extended to January 1, 2014.  The act provides a tax break for homeowners facing financial hardship brought about by foreclosure and short sale.
• Deduction for mortgage insurance premiums for those making below $110,000 annually.  This was extended through 2013 and made retroactive to cover all of 2012.
• A 15-year straight line cost recovery for qualified leasehold improvements on commercial property was extended through 2013 and made retroactive for all of 2012.
• The 10% tax credit (limited to $500) for homeowners for energy efficient improvements to existing homes was extended through 2013 and made retroactive to 2012.
• The capital gains rate will remain at 15% for those earning less than $400,000 annually and couples earning less than $450,000 yearly.  Gains above these amounts will be taxed at 20%.  Additionally, the $250,000/$500,000 exclusion for the sale of a principle residence remains.

Nothing like waiting until the last minute.

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