To: Ben Bernanke, Chairman Federal Reserve
Stop Big Banks From Getting Tax Break On Foreclosure Abuse Deal
Breaking the law should not be a business expense.
Do not let these corporations deduct the settlement costs.
Do not let these corporations deduct the settlement costs.
Why is this important?
U.S. mortgage lenders will benefit in a deal to settle charges that they wrongfully foreclosed on many homeowners.
Under the deal, 12 mortgage lenders will pay more than $9 billion to compensate hundreds of thousands of people whose homes were seized improperly, a result of abuses such as "robo-signing." That's when banks automatically approved foreclosures without properly reviewing documents.
Taxpayers will end up subsidizing them for the settlement money they will have to pay.
The Internal Revenue Service regards the lenders' compensation to homeowners as a cost incurred in the course of doing business. Result: It's fully tax-deductible.
Under the deal, 12 mortgage lenders will pay more than $9 billion to compensate hundreds of thousands of people whose homes were seized improperly, a result of abuses such as "robo-signing." That's when banks automatically approved foreclosures without properly reviewing documents.
Taxpayers will end up subsidizing them for the settlement money they will have to pay.
The Internal Revenue Service regards the lenders' compensation to homeowners as a cost incurred in the course of doing business. Result: It's fully tax-deductible.