Also serving the communities of De Luz, Rainbow, Camp Pendleton, Pala and Pauma

Rep. Issa will kick you when you are down

We hear all the bad news about defaults on mortgages. Lenders really do not want to take your property back in this kind of falling market. Repossessing homes and holding them months on end makes them no money, so they are trying to work out deals with homeowners before they default. In many cases they actually forgive part of the debt.

If a mortgage lender forgives debt as part of a short sale or foreclosure or what have you, they send the IRS a 1099 with the amount forgiven. At tax time you are obligated to report this forgiven mortgage debt as 1099 income. This amount is then taxed as ordinary income. So, not only are people having a hard time with losing their jobs and their homes, but Uncle Sam wants to pile on a bunch of taxes. Aw… How many ways can this government make like miserable?

It appears the government had a change of heart. Congress just passed the Mortgage Forgiveness Debt Relief Act of 2007 (HR 3648). As the title implies, the primary goal of the proposed legislation is to buffer homeowners who currently face an unwelcome tax bill when the lenders forgive some of their loan. The bill sailed through the House by a vote of 386 to 27. All but two California congressmen voted for the bill and Bush promises to sign the bill into law. Wonder of wonders!

So, which California congressman voted against the bill? Our own 49th District Representative, Darrell Issa. And last week Issa voted against adding four million kids to the Children’s Health Insurance Program.

We in Fallbrook have a heartless, mean-spirited man representing us. He will kick you when you are down – even if you are a kid.

Joe Howard Crews

 

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