The IRS recently gave an optional safe harbor to homeowners who receive or benefit from the federal Homeowner Assistance Fund in response to the COVID-19 pandemic.
The guidance, Rev. Proc. 2021-47, allows taxpayers to compute their itemized deductions for mortgage interest and real property taxes when they received a payment in the same tax year from the program.
The guidance excludes the homeowner relief payments from homeowners’ gross income and addresses information reporting issues for payers and lenders. Learn more.