(Bloomberg) -- Bank of America Corp. must set aside $490 million of its $16.7 billion settlement to cover taxes that borrowers face on forgiven mortgage debt -- a step taken by the Justice Department to give homeowners relief that Congress had not provided.
The bank’s accord with U.S. and state authorities to settle claims over flawed bond sales is the first major settlement to include funds to be used in case lawmakers failed to extend forgiveness on home-loan debt reductions. The tax credit expired on December 31.
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