Does anyone know what the state tax ramificatios are in foreclosure?

[mrange25]

I know about the mortgage debt relief act of 2007 at the federal level, but i never hear much about the consequences at the state level. Would someone still get a $40,000 bill at the state level?

I talked to some guy at youwalkaway.com and he said that "most states" have aligned with the mortgage debt relief act. Do you know of any websites that someone can find out the state tax liabilities, or does anyone have any direct experience with this yet?

[Kimbly]

I would definitely consult with a CPA. While making the decision whether to walk or not, I had a consult with mine to ask questions. She said most states are NOT forgiving the debt and are requiring the payment of income tax to the state on the 1099'ed amount.

[mrange25]

I think i found the answer to my own question. I called up my state and they say that the state gross income has to follow the federal return.

So the Mortgage debt relief act is all encompassing if you qualify
yay!