What is the Mortgage Debt Relief Act of 2007?
The Mortgage Debt Relief Act was passed in 2007 and applies to debt forgiven between 2007 and 2012. In cases where a 1099-A or 1099-C is issued, the homeowner is generally not responsible for paying taxes on the amount of cancelled debt because the Debt Relief Act allows taxpayers to exclude income from discharge of debt on their principle residence.
