Tuesday, September 18, 2007

Congress Blaming IRS for Foreclosure Problems

The issue of tax liabilities resulting from a home foreclosure has really been getting a lot of attention. Just a few hours after I posted my latest featured blog, the tax consequences of foreclosures, I came across another blog entry on TaxProf Blog discussing who is to blame for the problem. On Friday, Congress sent a letter to the IRS asking them to provide relief for people with tax liabilities resulting from foreclosures, but even in the letter Congress admitted it would be easier to fix with new legislation. However, providing relief to taxpayers affected does not really solve the problem it merely provides a way for taxpayers to resolve their debt. What Congress needs to do is properly fix the tax code with new legislation so that the problem can be fixed before it starts.

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