[murphE]

I wonder if the government will tax as income any forgiveness of debt/ principle or interest. Hmm.

[nufsed]

The government is giving a grace period on primary residences. There is no tax on debt forgiveness before January 2010.

However, the debt forgiveness tax exposure continues on investment/rental properties.

[nufsed]

http://www.irs.gov/newsroom/article/0,,id=174034,00.html