Senator Lou Correa 34th Senate District
For Immediate Release
February 12, 2010
Contact: John Scribner (916) 651-4034
Correa Presses for Continued Homeowner Tax Protections
SACRAMENTO, CA – State Senator Lou Correa (Orange County) is jointly authoring legislation that would extend relief to California homeowners who continue to be plagued by injustices of a tax on a phantom gain, a taxable event generated by a foreclosure.
In 2008, Senators Correa and Michael Machado authored Senate Bill 1055 (SB 1055) which established California’s conformity to the federal cancellation of debt (COD) income exclusion. This provided state income tax relief to distressed California homeowners who had to terminate mortgage loans for a principal residence due to a short sale or a loan restructure. The tax relief provision of this law expired in January 2009. Continue reading