The California Senate passed the California Association of Realtors-sponsored tax relief bill without a single “no” vote on June 20. SB 30 (Calderon, D-Montebello) protects homeowners from having to pay income tax on a short sale.
SB 30 will extend the sunset date in California law to Jan. 1, 2014. Upon its passage, the measure will be retroactive to Jan. 1, 2013. With its passage in the Senate, SB 30 is now headed to the Assembly. Realtors will be urging their Assembly members to pass the debt relief bill.
The road to passage is not all smooth, however. In late May, the Senate Appropriations Committee linked SB 30 to SB 391. The state group opposes this bill because it creates a $75 recording tax for all real estate transactions other than the sale of property. The link, in the form of an amendment, says SB 30 cannot take effect unless SB 391 does as well. The state Senate passed SB 391 on May 30 and, like SB 30, the bill will go to the Assembly.
“We will continue to work toward delinking the two bills–defeating the recording tax, and passing tax relief for those going through a short sale,” says Carolyn Miller, president of the Silicon Valley Association of Realtors.
While SB 391 does not apply to sale transactions, the measure applies any time a home/property owner records a document (e.g., refinancing, transferring into or out of a trust, liens, quit claim deeds, etc.).
“Realtors are advocates for affordable housing, but we believe it is bad policy to fund affordable housing at the expense of property owners who need to record real estate documents,” explains Miller.