Great News for Struggling Md. Homeowners

Dear Ms. Hood:

Last month, Congress passed and the President signed the Tax Increase Prevention Act of 2014. Knowing of your interest in the Mortgage Forgiveness Tax Relief Act, I am writing to share with you some good news. This bill retroactively extends the exclusion for forgiven mortgage debt for 2014.

I know that many homeowners are working hard to recover from the economic downturn of the last few years. The Mortgage Debt Relief Act of 2007 allowed homeowners to eliminate the tax penalty from debt reduced through mortgage restructuring or a foreclosure of their principal residence. More than 100,000 taxpayers have seen their tax liability reduced because of this law. I am very pleased that Congress extended it through 2014.

Not only will this bill help middle class homeowners by removing the mortgage forgiveness tax penalty, it also allows them to continue deducting mortgage insurance premiums. It provides deductions for certain college tuition expenses and it continues the state and local sales tax deduction. It also has important tax breaks for small businesses that want to invest in new equipment and grow their business.

Having the right tax policy is extremely important to the future of the economy and the country. You can count on me to continue fighting for the priorities that make sense for Maryland. I hope you have a wonderful holiday season and wish you a happy New Year.

Sincerely,
Barbara A. Mikulski
United States Senator