Offer Assistance To Middle Class Families Who Suffer Loss on Sale of Primary Residence By Allowing Loss as Tax Deduction

Homeowners with gross incomes < $250,000 who have lived in their primary residence for at least 3 years and who suffer a loss on the sale (excluding short sales) of their primary residence should be allowed to offset their taxable income by declaring the loss as a tax deduction. The loss should be able to be declared as a deduction by spreading the loss over a 5 year period; annual deduction should not be allowed to exceed $20,000 per year. This 'tax favorable' treatment of losses on sales of primary residence would allow families who made considerable downpayments or who have built equity in their primary residences and who face considerable losses to sell their homes and recoup some portion of those losses. This act will speed up recovery of the nation's housing market.