Friday, September 21, 2007

IRS Unveils Foreclosures Section of

The IRS’ official website, has unveiled a new section of their website devoted to providing information to families who have had increased tax liabilities due to foreclosures. The IRS is letting families know that although "foreclosures can have tax consequences, special relief provisions can often reduce or eliminate the tax bite for financially strapped borrowers who lose their homes." However, providing relief after people are already in debt to the IRS doesn’t really solve the problem. The only thing in the IRS’ announcement that really seems to address a solution is when they say "the IRS urges struggling homeowners to consider their options carefully before giving up their homes through foreclosure." Unfortunately this is the best we will probably see any time in the near future as the only way to really fix the problem is for Congress to step in and change the tax code so that it no longer considers foreclosure relief taxable income.

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