Money Watch Q & A: Expired Debt Relief Act - KTVN Channel 2 - Reno Tahoe Sparks News, Weather, Video

Money Watch Q & A: Expired Debt Relief Act

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In 2007, Congress adopted a law that spared distressed homeowners from being taxed on the amount of their mortgage loan that was forgiven. At the end of 2013, however, the Mortgage Forgiveness Debt Relief Act expired. This means many struggling homeowners could be subject to a hefty bill to the IRS if they short sale or foreclose on their home.

There are some options, according to Tricia Darby, who is a partner and attorney with Darby Law Practice, Ltd. She says first you must determine if you will be able to afford the negative tax consequence. If you are living in your home without making payments, she suggests saving money for the tax bill to the IRS. For others, however, bankruptcy is a more realistic option. Bankruptcy and foreclosure both blemish your credit, however. To decide what option might be best for your situation, Tricia will be on our Money Watch Q & A segment tonight at 5 p.m. If you would like to speak with her, call (775) 858-2222 between 5 - 6 p.m.

You can also reach Tricia and her team at the contact information listed below:

Darby Law Practice, Ltd.
4777 Caughlin Parkway
Reno, NV 89519
(775) 322-1237

Written by Kristen Remington
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