In response to requests to provide guidance on the impact of mortgage loan forbearance programs on the tax treatment of securitization vehicles, such as real estate mortgage investment conduits (“REMICs”) and investment trusts, the IRS issued Revenue Procedure 2020-26. The IRS establishes that forbearance programs offered as COVID-19 relief will not jeopardize the tax treatment and qualifications of REMICs and investment trusts.
The Rev. Proc. applies to forbearances granted under the CARES Act, and other forbearance programs offered by loan servicers and holders, either voluntarily or state mandated, for borrowers experiencing financial hardship due to the COVID-19 emergency. Continue reading