An Act relative to the relief of mortgage debt

This bill amends Massachusetts tax law to allow homeowners to exclude up to $2 million of forgiven mortgage debt from their state taxable income, provided the debt was related to their primary residence. It specifically covers situations where debt is reduced through restructuring or forgiven during a foreclosure, while excluding cases where the loan is discharged due to services performed for the lender or other factors unrelated to the home's value. The excluded amount is used to lower the taxpayer's basis in their home rather than creating a cash refund, and the law applies retroactively to debt discharges occurring on or after January 1, 2013.