The Mortgage Debt Relief Act of 2007 provided for no income tax to a borrower on any deficiency after a foreclosure or a short sale of a mortgage used to purchase a home, or make improvements to the home. The Act expired December 31, 2013. They used to call these taxable events phantom income. Here’s how it works. I am a homeowner and my bank writes down the mortgage $150,000.00 because I lost me job. Well, pre-2007 the IRS would hit you for 33% of the write down in a tax. Last week Congress passed legislation to extend the Act until December 31, 2014. In other words, any deficiency as discussed above will not be taxable income to a borrower if the foreclosure or short sale occurred in 2014.

We have a good track record of helping property owners get relief. At least up through 2014, there is no tax on many of these transactions. Call Bill Miller at 602.319.6899 if you would like to discuss this or other business law or real estate related matters. Our office is located at 8170 N. 86th Place, Suite 208 Scottsdale, Arizona 85258.

We also handle, Breach of contract, Non-compete agreements, Non-disclosure agreements, Employee theft and embezzlement, Insurance purchases and enforcement of policy coverage, Negotiation and/or enforcement of commercial leases, Negligence and gross negligence resulting in losses, Intentional acts causing a company to suffer damages, Tortious interference with contractual relationships, Unjust enrichment, Real Estate fraud, Consumer fraud, Conversion/Theft, Intentional and/or negligent misrepresentation, Business torts and Real estate title and escrow.

Home Builder be Aware!

On April 22nd, 2014, HB 2018 was signed into law by Arizona Governor, Jan Brewer. The bill will amend two key anti-deficiency statutes, A.R.S. §§ 33-729 and 33-814, the former relating to judicial foreclosures and the latter to non-judicial foreclosures. Borrowers have relied upon both of these statutes in order to avoid liability on mortgages or deeds of trust after foreclosure. On top of amending the statutes, HB 2018 also includes additional provisions to both of the statutes; the provisions serve to elucidate and limit anti-deficiency protections for borrowers on all mortgages and deeds of trust executed after December 31, 2014.
Deficiency protections for commercial homebuilders, who receive loans for the purpose of constructing new homes to sell but the homes are not completed or occupied at the time of foreclosure, will be eliminated by the amendments to A.R.S. §§ 33-729 and 33-814. Should the property under consideration never be completed or actually made use of by the borrower, the amendments also clarify that the borrower is not entitled to anti-deficiency protection.
The amendments will give more guarantees to lenders for loans to commercial and residential homebuilders, even though there has been a downward trend in underwater mortgages over the past couple years.
We have represented many home builders over the years, if you have questions about this new law give Bill Miller a call at 602-31-6899 or stop by the office at 8170 North 86th Place, Suite 208 Scottsdale, AZ 85253.

In the last few years, whistleblower claims are on the rise.  These claims now comprise 41% of the more than 93,000 discrimination charges filed in 2013, according to a February report from the U.S. Equal Employment Opportunity Commission (EEOC).  This is an increase of 28% over 10 years.  At the same time, particularly since the…

On May 28, 2013, the Arizona Court of Appeals ruled in Cook v. Town of Pinetop-Lakeside that there is no statute of limitations for a quiet title lawsuit. 1 CA-CV 12-0258. In short, if an owner of real property gives permission to a neighboring owner to drive over their property for ten or twenty years, the…

Just weeks before a scheduled trial, Credit Suisse has reached a $400 million settlement in litigation over the demise of National Century Financial Enterprises. The settlement resolves claims that bondholders were defrauded to the tune of $2 billion when National Century collapsed amid a health-care financing scandal in 2002 — and reportedly brings the bondholders’…