Bill > S1879

This bill provides relief for mortgage debt by allowing taxpayers to exclude up to $2 million ($1 million for married filing separately) of forgiven debt on their principal residence from their gross income, subject to certain conditions. The exclusion applies to "acquisition indebtedness" as defined in the Internal Revenue Code and reduces the Massachusetts basis of the principal residence. The bill specifies that the exclusion takes precedence over an insolvency exclusion unless the taxpayer elects otherwise. The bill applies to discharges of indebtedness on or after January 1, 2013, and requires the commissioner to promulgate regulations to effectuate the provision within 180 days of the effective date of the act.