Call Your Senator Right Now t0 stand with REALTORSR and families and Support "Delinking" Amendment to SB 30 and VOTE YES ON SB 30

 

	Senate Dirty Tricks Continue! Help Save C.A.R. Tax Relief Bill!  Call Your Senator NOW! Urge Support for Amendments to Save SB 30!! In a surprise move last week, the Senate Appropriations Committee linked C.A.R SPONSORED bill, SB 30, which provides tax relief to those who are selling a home in a short sale to SB 391, a C.A.R.-opposed bill that creates a recording tax. This is nothing more than a shameful political maneuver to force C.A.R. to support the recording tax. Senate leadership has forced an amendment to SB 30 that says it cannot take effect unless SB 391 passes as well. Despite C.A.R. opposition and calls from over a thousand REALTORS®, SB 391 passed the Senate Wednesday. Now, C.A.R. will attempt to amend SB 30 to remove the link to SB 391. Even if you have already called your Senator to oppose SB 391, the recording tax, please call again to urge SUPPORT for amendments that will protect SB 30 from dirty tricks! REALTORS® and the public should be OUTRAGED that distressed homeowners are being held hostage by Senate Leadership. Action Item  CALL YOUR SENATOR TODAY Ask him or her to stand with REALTORS® and families and Support “Delinking” Amendment to SB 30 and VOTE YES ON SB 30 (tax relief on debt forgiven in a short sale)!  CALL 1-800-969-3310 Enter PIN# 159511922 to be connected If you wish, you can bypass the first part of the message by entering your PIN, followed by the # sign, at any time. You may also bypass the 2nd part of the message by hitting the “1” key to be directly connected to your legislator’s office.  Background - SB 30 Short sales have become an increasingly important alternative to foreclosure for distressed homeowners. Federal and state law views the debt forgiven by a lender in a short sale as income. In recent years, C.A.R. and NAR have secured short-term relief in state and federal law that keeps this “phantom” income from being taxed.  In early January, the President signed into federal law an extension of mortgage debt tax forgiveness until the end of this year. Because state legislation has not yet passed extending the sunset for state tax purposes many short sale sellers are in limbo: the forgiven debt is not income for federal tax purposes but state law has not yet been passed to conform to federal law making it clear that the forgiven debt is also not income for state tax purposes. SB 30 will provide that much needed tax relief. C.A.R. is SPONSORING SB 30 because: Failure to act could force families into foreclosure. Distressed homeowners often only have two choices – closing a short sale or allowing their home to be foreclosed upon. If they fear state income tax liability on their short sale, they will opt for foreclosure instead, in order to avoid state tax liability. Foreclosures destabilize communities and are more damaging to housing values than short sales. Distressed homeowners forced into foreclosure will have a more difficult time restoring their credit than would be the case following a short sale. Families are stuck in financial limbo. Homeowners currently in short sale negotiations can’t finalize these transactions without potentially incurring state tax liability.   Sellers who are involved in short sales or contemplating a short sale need to know now that the debt forgiven is not going to be treated as income for state tax purposes.   It’s the right thing to do. Families forced to make the difficult decision to sell their home as a short sale are already in financial trouble. They simply should not have tax liability on “phantom” income or debt forgiveness, money they’ve never actually received.