Valuable Information

To follow please find a simple explanation of what has been initiated by our elected officials in Washington, what is on the table in California on debt forgiveness on short sales, etc, that I recently received from Don Faught, President of the California Association of Realtors.  This will help you understand all the changes that are taking place in our tax structure.   Congress made permanent the repeal of the “Pease Limitations” on itemized deductions – including  the mortgage interest and property tax deductions. 

The American Taxpayers Relief Act of 2012 was signed into law on Jan. 2.  The law includes a provision to extend the Mortgage Forgiveness Debt Relief Act, which will for one more year exempt the taxation of mortgage debt that is forgiven when homeowners and their mortgage lenders negotiate a short sale or loan modification (including any principal reduction).  However, the California exemption expired at the end of 2012, so forgiven mortgage debt is considered taxable state income for now.

We recognize this could impact short sales in California, and that’s why C.A.R. is sponsoring SB 30 (Calderon, D-Montebello).  SB 30 will conform state law to the federal law passed earlier.  Upon passage of SB 30, the measure will be effective retroactive to Jan. 1, 2013.

Congress made permanent the repeal of the “Pease Limitations” on itemized deductions – including the mortgage interest and property tax deductions – for all taxpayers whose adjusted gross income (AGI) falls below $300,000 for married couples filing jointly and $250,000 for individuals.  Pease Limitations will be reinstituted for high income filers above those threshold amounts.  This means a taxpayer’s itemized
deductions will be reduced by 3 percent of the amount of his or her AGI that exceeds the threshold amount.  For example, a married couple with an AGI of $400,000 would be $100,000 over the threshold; the couple’s itemized deductions would be reduced by $3,000 which is 3% of $100,000.  No matter how high a taxpayer’s AGI, he or she cannot lose more than 80 percent of the total itemized deductions.  Those most limited by Pease will be extremely high income filers who do not have many itemized deductions.

See NAR’s Q&A on Pease Limitations.

Again, I want to recognize and thank the tens of thousands of C.A.R. members who worked to successfully maintain the mortgage interest deduction and mortgage debt forgiveness by responding to the Calls for Action.

Just last week, the Consumer Financial Protection Bureau (CFPB) issued new rules that define a “qualified mortgage (QM),” which will protect borrowers from deceptive lending practices.  The CFPB was charged with drafting and implementing the rules under the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act to clearly define underwriting goals and other standards that a loan must have in order to ensure the borrower has the ability to repay the loan.  When lenders issue a QM mortgage, they are afforded a safe-harbor from legal liability shielding them from being sued for originating a loan they knew the borrower could not repay.  The new rules go into effect Jan. 10, 2014.

About marilynsellshollisterrealestate

I am a native Californian born in Los Angeles and have resided in San Benito County since January 30, 1959. I attended the University of Southern California. I am a licensed Real Estate Broker, license #00409787, active for almost 45 years. I started my career in 1972 and still am totally committed to the highest level of service to my clients. I am currently associated with Intero Real Estate Services. I am Past President of the San Benito Association of Realtors, serving in the role on numerous occasions. I was a Director of the California Association of Realtors for over 18 years, having served on numerous committees. I also served 2 terms representing the California Association of Realtors at the National level, NAR. I am a certified SRES (Senior Real Estate specialist), since 2005. My community involvement has included membership in the Hollister Rotary Club, serving as their first woman President in 2002. In the late 1960's, I became a member of the El Torillo Chapter of Children's Home Society, and served as President, and was also President of the Tri-County Council of CHS, which is today Kinship Center, and I am currently a Senior Active. I am a member of the San Benito Chamber of Commerce. From 2002-2008, I served on the Board of the Hollister Downtown Association and was their President from 2006-2007, and still serve on sub-committees of this organization. And, I am currently serving my 3rd term on the Community Foundation. My record of performance and my reputation have made me who I am in the industry. I am a household name in San Benito County, when you think of Real Estate. My name is recognized not only in Hollister, but in our neighboring counties, Monterey, Santa Cruz and Santa Clara counties. I have been involved in land development, marketed several subdivisions, sold ranches, commercial leasing, bank-owned properties, short sales and own a Property Management Company, Hollister Rental Properties, for more than 35 years. I am proud of my sales record and for the majority of my career I have been in the top 1% of major Real Estate Companies including Van Vleck Realtors, Cornish and Carey, Contempo, Seville-Contempo, Century 21, Coldwell Banker and finally Intero Real Estate services for the last 15 years. Using my skills in negotiating, mediation and transaction closure, during 2010 and 2011, I was involved with the City of Hollister's First Time Home Buyer Down Payment Assistance Program. The program was the City's Redevelopment Agency, under Bill Avera, with the assistance of CJ Valenzuela who was working with the County of San Benito. CHISPA, a non-profit, was responsible for restoring homes to equal to new condition that the City had taken back in foreclosure, or that they had acquired. When the homes were restored, we put them on the Multiple Listing Service and we went out and promoted the City's Down Payment Assistance Program. Buyers were screened and qualified by our preferred lenders. I facilitated workshops for First Time Buyers explaining the programs. I negotiated the contracts for the City of Hollister and with the Buyers. With this program, I closed 2 homes in 2010, and 4 homes in 2011. On a personal note, I am married to Richard Ferreira, a retired General Contractor/Developer. We have a combined family of six daughters, six grandsons and 3 granddaughters. We share commons interests in travel, movies, entertaining, and Richard has picked up my love of cooking. Our spare time is spent with family and enjoying our grandchildren.
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