Mortgage Relief

About Mortgage Relief:

acquired freedom from mortgage debt, generally through assumption of mortgage by another party or by debt retirement. In a tax-free exchange, mortgage relief is considered boot received, causing a taxable gain to the extent of the lesser of the realized gain or the fair market value of the boot. Mortgage relief in excess of the tax basis of property will result in taxable gain in the case of abandonment, which can be reduced if there are continuing obligations on the debt.