TALLAHASSEE, Fla. – Nov. 21, 2012 – Fla. Attorney General Pam Bondi has joined forces with 40 other state attorneys general to lobby Congress to extend a tax break for homeowners who struggled through financial hardship such as a foreclosure and were granted mortgage debt forgiveness.

The National Association of Realtors® (NAR) has issued a call to action, urging its million-plus Realtor members to contact their lawmakers and request an extension of Mortgage Forgiveness Debt Relief Act, which has been in place for five years.

“Over a quarter of all transactions still involve distressed properties. That is why you must take action now,” NAR said in a previous email to members. “Homeowners shouldn’t be forced to pay a tax on money they’ve already lost with cash they never received.”

Under federal law, cancelled debt is generally considered taxable income. Since 2007, however, the Mortgage Forgiveness Debt Relief Act has exempted homeowners from paying taxes on the amount of money their mortgage lender forgives as a result of a loan modification, short sale, or foreclosure. The act is due to expire at the end of the year, but the bill would extend the relief through 2014.

© 2012 Florida Realtors®