For those considering buying or selling a West Knoxville or Farragut home in 2013, the “Fiscal Cliff Bill” [also known as H.R. 8] addressed a lot of key housing issues. It was signed into law on January 2nd of this year by President Obama. Here is a breakdown of what the “Fiscal Cliff Bill” means if you are planning on buying or selling a home in West Knoxville or Farragut this year.
Mortgage Debt Forgiveness Act Extended Through 2013
One huge issue addressed in bill is that the Mortgage Debt Forgiveness Act was extended through the end of the year. For any Knoxville homeowner facing foreclosure or considering doing a short sale, this comes as a huge source of relief. Under the act, any borrower who sold their Knoxville home in a short sale, modified their loan, or went into foreclosure, would not required to pay taxes on that forgiven income. The rule applies to up to $1 million for those filing his/her taxes as an individual and up to $2 million for those filing their taxes jointly.
Deduction of Mortgage Insurance Premiums
For West Knoxville and Farragut buyer who have paid mortgage insurance premiums on FHA, VA, or Rural housing mortgages, along with those who pay private mortgage insurance premiums or guarantee fees on conventional or low down payment loans, they will be able to write those fees off for a mortgage deduction this year. Also, the bill allows any borrower who paid that in 2012 to write it off on their taxes as well. The write off is only available for those who have an adjusted gross income of $110,000 or less.
Tax Credits for Energy Efficient Homes
Any West Knoxville or Farragut homeowner who makes energy efficient improvements including installing energy-efficient windows, insulation, and other upgrades is eligible for a tax credit ranging from $200 to $500. For more details, check out the IRS website.
Are you thinking about buying a West Knoxville or Farragut home? Please let us know if there is anyway that Knoxville Home Team can assist you in your home search. You can contact Rick at 865-696-9002 or via email at [email protected]. Or, you can contact Kati at 865-392-5880 or via email at [email protected].