Industry News

House passes foreclosure tax-break bill

Tax hike on second-home sales would pay for relief

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A bill that would give homeowners facing foreclosure a tax break if their lender forgives part of their debt -- and make up for the lost revenue by raising taxes on sales of some second homes -- passed the House of Representatives Thursday. HR 3648, the Mortgage Forgiveness Debt Relief Act of 2007, would also extend the deduction for private mortgage insurance to 2014, helping home buyers avoid high-interest piggyback loans. "It is just not right or fair that families struggling through a foreclosure would then face a tax bill in addition to losing their homes when they have seen no increase in their net worth," said the bill's author, Rep. Charles Rangel, D-N.Y. in a statement. "This bill rights that wrong and provides tax relief to millions of American families." Although the bill enjoyed bipartisan support in the House -- passing in a lopsided 386-27 vote -- some of its provisions are expected to be subject to further debate as the Senate weighs similar legislation. ...