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Last week at my other tax blog: Cost of tax procrastination; Foreclosure tax relief

Life is full of things we don't want to do, and tax situations are no exception. 

Bankrate Taxes Blog icon Tax filing procrastination and the possibility of putting off forever tax costs connected to the recent banks/state attorneys general deal were the subjects last week at my other tax blog.

Five major banks reached a $25 billion deal with the federal government and 49 state attorneys general over alleged foreclosure abuses that helped contribute to the current housing crisis. The agreement would grant relief to homeowners who were foreclosed upon, as well as pay affected homeowners from a $20 billion fund.

That generally is good news, but under current tax law, those cash payments as well as forgiven home debt would be taxable income to the former homeowners.

A bill introduced last week by three Democratic members of the House Ways and Means Committee would eliminate those botched home loan tax burdens.

It's unclear as to whether Congress will speedily consider the bill.

Millions of taxpayers know about slow action when it comes to taxes on a personal level. But they might be surprised that such delaying could be costly.

A recent survey found that tax-filling procrastinators, defined as those who send in their returns in March or April or who request an extension to file, pay nearly double to complete their forms than do those who send in their taxes in January and February.

Such information probably won't help you save on tax preparation costs this year, but maybe it will encourage you to do your 2012 Form 1040 early in the 2013 tax filing season.

You can check out new posts each Tuesday and Thursday at my Bankrate Taxes Blog. And if you happen to miss them there, you can find a wrap-up here each Saturday.

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Comments

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John

I fully appreciate the opinions of people that state things like “if you live outside of your means and enter into a mortgage or contract for a property you can’t afford, then it’s your own stupid fault and a foreclosure is inevitable – although it’s somewhat the banks responsibility also to not be so greedy etc”. I don’t disagree, I think it’s the individuals responsibility to study any contract they get themselves into carefully, and to ensure they will be making payments they can cope with. However, I was made redundant and could no longer pay the bills in full. I’m hard working and struggled to find new work in my area, I received a foreclosure notice and when you’re supporting a family it’s one of the most stressful and sickening experiences to go through. I fortunately stumbled on a little blogger site with an article that recommended a website that could help http://www.whatliesinyourdebt.com
Blogger site if you’re interested http://cleanforeclosure.blogspot.co.uk

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