Posted by: Business Law EBooks | June 24, 2009

IRS Ruling Gross Income

Revenue Ruling 2009-19 holds that Pay-for-Performance Success Payments that benefit a homeowner under the United States Government’s Home Affordable Modification Program are excludable from the homeowner’s income under the general welfare exclusion.  This program helps homeowners who have defaulted, or are at risk of default, on their mortgages.  A homeowner that makes timely payments on a modified loan is eligible to have incentive payments made to lenders/investors that reduce the principal balance on the loan.
Revenue Ruling 2009-19 will appear in IRB 2009-28, dated July 13, 2009

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