To avoid the Fiscal Cliff, the FED has done what they need to whether we like it or not. Here is what it means to Real Estate and Homeowners. The President is Expected to Sign these Back Into Law.
• Mortgage Forgiveness Debt Relief Act extended to January 1, 2014. In place since 2007, the act provided a tax break for homeowners who struggled through financial hardship such as a foreclosure, and were granted mortgage debt forgiveness
• Deduction for mortgage insurance premiums for filers making below $110,000 is extended through 2013 and made retroactive to cover 2012.
• The 15-year straight-line cost recovery for qualified leasehold improvements on commercial properties is extended through 2013 and made retroactive to cover 2012.
• The 10 percent tax credit (up to $500) for homeowners for energy efficiency improvements to existing homes is extended through 2013 and made retroactive to cover 2012.
• "Pease limitations" that reduce the value of itemized deductions are permanently repealed for most taxpayers but will be reinstituted for high-income filers.
• The capital gains rate remains at 15 percent for individuals earning less than $400,000 per year and couples earning less than $450,000. Any gains above these amounts will be taxed at 20 percent. The $250,000/$500,000 exclusion for the sale of principle residence remains.
Wishing Everyone a Happy, Healthy and Cliff-Free 2013!