I was watching the debate on C-Span (very bi-partisan by the way), and once in awhile C-Span breaks away from the live viewing and gives a synopsis of what is going down – it was during the summary that I heard that to pay for the debt forgiveness they were countering with the limit of second home capital gains savings. Maybe this has to do with Pay-Go.
I don’t have a problem with IRS not taxing discharged debt on first mortgages. But I have a huge problem with not taxing discharged debt on re-fi’s and HELOCs, etc. that were used to support a standard of living beyond income (as someone else mentioned); I didn’t hear those specifics (whether it was just for first mortgages or all debt)
