FHA help for homeowners program, do the homeowners have to pay tax on the amount that is forgiven?

With this loan modification program, Help 4 Homeowners, by FHA, will the homeowner have to pay a tax on the amount of the home loan that if modified, or forgiven, by the original lender? Will there be a balloon tax for that amount?

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Tax Impact of Principal Reduction | War on the Home Front
With the Obama administration and private lenders actively considering mortgage-principal-reduction programs to help financially distressed homeowners, the Internal Revenue Service has issued an advisory to taxpayers who receive ? or seek ... There's a tax wrinkle in the fine print: The IRS will require you to reduce your ?basis? in the house ? your ?cost? for tax purposes ? by the amount of the forgiven debt. But that's not likely to be a big concern for most homeowners ...

Making Home Affordable Program FAQ's | ShopNewHome.co.cc
Have a mortgage payment (including taxes, insurance, and home owners association dues) that is more than 31% of your gross (pre-tax) monthly income, and have a mortgage payment that is no longer affordable, perhaps because of a significant change in income or expenses. ... The modification payment will also include a monthly amount to be set aside (escrowed) to pay taxes and insurance when they become due. This escrow is required even if your prior loan was not escrowed. ...

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A modification also may involve reducing the amount of money you owe on your primary residence by forgiving, or cancelling, a portion of the mortgage debt. Under the Mortgage Forgiveness Debt Relief Act of 2007, the forgiven debt may be excluded from income when calculating the federal taxes ... While some agencies limit their counseling services to homeowners with FHA mortgages, many others offer free help to any homeowner who is having trouble making mortgage payments. ...

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