Question:  We bought our home in a new Gilbert subdivision six years ago.  Although there has been some appreciation lately, our home is worth only $260,000.  We still owe $380,000 on the mortgage.  After my husband lost his job last year, we finally had to stop making payments, and the foreclosure occurred this February.…

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The general IRS rule is that any forgiveness of debt will be taxable. In response to the housing disaster of the mid-2000’s, the Act was passed by Congress in 2007 to give relief to taxpayers who had debt forgiveness as the result of either a foreclosure or a short sale. The Act was subsequently extended…

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 Question:  We bought our first house in west Phoenix for $62,000 cash.  The house is now worth $130,000.  Our air-conditioning business is doing really well, and we want to move to a nicer neighborhood.  My husband’s sister does our tax returns every year, and she says that we will not have to pay any tax…

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