Legislative Update - Real Estate Issues:
* At the Federal level, efforts to eliminate the Mortgage Interest Deduction (tax deduction) for homeowners have been quashed (at least for the time being) by all of the good work by the National Association of REALTORS® on the Federal level and the Minnesota Association of REALTORS® on the State of Minnesota level. While this may be brought back up in the future, it is unlikely that it will be an issue again until after the 2012 elections. House Resolution 25 "Expressing the sense of the Congress that the current Federal income tax deduction for interest paid on debt secured by a first or second home should not be further restricted".
* Thanks to the efforts of the Minnesota Association of REALTORS®, there are no changes expected to the Capital Gains exemption for homesellers. The current exemption for the $250,000 of Capital Gains (single) or $500,000 of Capital Gains (married couple) remains in effect.
* Efforts to eliminate the Minnesota Property Tax Refund for homeowners have not been successful, again thanks in part to the efforts of the Minnesota Association of REALTORS®. In the Minnesota legislature, a bill has been introduced that would increase the maximum refund allowed for homeowners with household incomes from $37,280 to $100,779.
* On the Federal level, there are efforts to eliminate the Mortgage Forgiveness Debt Relief Act and Debt Cancellation. This is going to be a big issue for anyone who is unfortunate enough to have to do a short sale of their home. Currently, homeowners can apply to the IRS for a waiver of the taxes on the amount of mortgage debt that is wiped out during the short sale process. In other words, if you owe $200,000 on your mortgage and you do a short sale and the house sells for $150,000, your lender will send you a 1099 for the taxes on the $50,000 that you didn't end up paying. This $50,000 is considered as income by the IRS. Currently, you can apply to have those taxes "forgiven" by the IRS. The National Association of REALTORS® is working to keep the current Mortgage Forgiveness Debt Relief Act and Debt Cancellation for at least another year, but this is not going to be an easy fight.
* There are those who are interested in eliminating Freddie Mac and Fannie Mae, but now there are new ideas coming to the forefront that will benefit homeowners and the economy in general. The idea is to combine these two public-private entities into one public entity that would offer a limited scope of mortgage products and would not allow multiple levels of derivatives to be created. If you can afford a 20% downpayment for a house, that's great, but without Fannie and Freddie, many prospective homeowners would not be able to purchase a home at all. Interesting statistic: an average family of 4 earning a median wage would have to save 6% of their income for 14 years in order to save enough cash to put a 20% downpayment on a median priced home. Can you imagine 14 years???
* There is a bill in the Minnesota legislature that would allow holders of Sheriff's Certificates to request information about a property's utility connection status. This is a benefit to the community because it would help lenders and anyone who purchases a foreclosure at a Sheriff's Sale to protect a vacant property from damage and preserve its condition.
*Another bill in the Minnesota legislature would make it possible for vacation rentals of single family or multi-family residential properties allowable for zoning purposes. In other words, some current zoning regulations would prevent a homeowner from offering a property as a vacation rental if it is in a residential area.
These are just some of the issues that we work on to protect private property owners' rights in Minnesota and at the federal level as well.
Who fights for private property owners' rights? As an active member of the National Association of REALTORS® and the Minnesota Association of REALTOR®, I DO! Blaine MN Neighborhoods
Comments (0)Subscribe to CommentsComment