SB 401 – What’s My Short Sale Tax Liability With The State of California?

So, you’re trying to figure out if you have California Tax Liability With The State of California if you sold your Simi Valley home via Short Sale or are planning to short sell your home.

SB 401 is set to work in line with the IRS Mortgage Debt Relief Act of 2007 forgiving tax liabilities that could affect Californians who disposed of their property through a Short Sale in 2009 . It also includes relief for those who received a reduction of principle through a Loan Modification or Cancellation of Debt income from a foreclosure.

Who is affected:

• If you were party to or will be a party to a Short Sale, Foreclosure or Loan Modification between 2009 and 2012.  2007 & 2008 already had this provision, SB 401 extends this relief now up through 2012.

What Do You Have to Do to Participate?

• If you qualify for the IRS Mortgage Debt Relief Act, then you could possibly qualify for SB 401.

WARNING:  There are serious liabilities related to home loans if you are foreclosed on, participate in a deed in lieu or participate in a Short Sale.  Make sure to consult with an attorney

DISCLAIMER: I am not a Tax professional nor is this information offering you Tax Advise. This is merely a report on the current passage of SB 401.  All information above should be verified with your Tax Preparer/Professional.

For more information you can read: Simi Valley Short Sale Information on this blog HomeBuysBlog.com

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Author – Ted Mackel Simi Valley Real Estate Agent – Keller Williams Realty

Ted Mackel is a top producer at Keller Williams Realty Simi Valley,

specializing in Simi Valley Real Estate

(805) 432-7705