1 of 1
SENATE DOCKET, NO. 1508 FILED ON: 1/16/2025
SENATE . . . . . . . . . . . . . . No. 2039
The Commonwealth of Massachusetts
_________________
PRESENTED BY:
Mark C. Montigny
_________________
To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:
The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
An Act relative to the relief of mortgage debt.
_______________
PETITION OF:
NAME:DISTRICT/ADDRESS :Mark C. MontignySecond Bristol and Plymouth 1 of 2
SENATE DOCKET, NO. 1508 FILED ON: 1/16/2025
SENATE . . . . . . . . . . . . . . No. 2039
By Mr. Montigny, a petition (accompanied by bill, Senate, No. 2039) of Mark C. Montigny for
legislation relative to the relief of mortgage debt. Revenue.
[SIMILAR MATTER FILED IN PREVIOUS SESSION
SEE SENATE, NO. 1879 OF 2023-2024.]
The Commonwealth of Massachusetts
_______________
In the One Hundred and Ninety-Fourth General Court
(2025-2026)
_______________
An Act relative to the relief of mortgage debt.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
of the same, as follows:
1 SECTION 1. Section 2 of chapter 62 of the General Laws, as appearing in the 2022
2Official Edition, is hereby amended by inserting after the word “lender” in line 213 the following
3subparagraph:-
4 (S) To the extent not otherwise excluded from gross income, in whole or in part, income
5attributable to the discharge of debt on a principal residence, including debt reduced through
6mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure,
7subject to the following conditions and limitations:
8 (i) No more than $2,000,000 of forgiven debt is eligible for the exclusion under this
9section, or $1,000,000 in the case of married filing separately for the purposes of federal taxes. 2 of 2
10 (ii) This section shall only apply to “acquisition indebtedness” as defined in section
11163(h)(3)(B) of the Code.
12 (iii) The amount excluded from gross income by reason of this section shall be applied to
13reduce, but not below zero, the Massachusetts basis of the principal residence of the taxpayer.
14 (iv) This section shall not apply to the discharge of a loan if the discharge is on account
15of services performed for the lender or any other factor not directly related to a decline in the
16value of the residence or to the financial condition of the taxpayer.
17 (v) If any loan is discharged, in whole or in part, and only a portion of such loan qualifies
18under this section, this section shall apply only to so much of the amount discharged as exceeds
19the amount of the loan, as determined immediately before such discharge, which does not
20qualify. The principal residence exclusion shall take precedence over an insolvency exclusion
21unless elected otherwise.
22 (vi) For the purposes of this section, the term “principal residence” shall have the same
23meaning as in section 121 of the Code.
24 SECTION 2. This act shall apply to discharges of indebtedness on or after January 1,
252013.
26 SECTION 3. The commissioner shall promulgate regulations to effectuate this provision
27within 180 days of the effective date of this act.