False Info Floating Regarding Real Estate Taxes & Medicare
I have received a number of inquires from clients and those who read my newspaper column about a “3.8% ‘sales tax’ on homes sold after 2012.” There are a lot of rumors and much incorrect information going around, especially online.
Here is a statement from the California Association of Realtors (C.A.R.):
“Misinformation has been spreading around the Internet that the Obama Administration will finance the new health care legislation with a tax on real estate. C.A.R. would like to clarify. The new law imposes a 3.8% tax for households in the top tax brackets on “unearned income.” This includes capital gains. However, this will not impact the exclusion on capital gains earned from the sale of a primary residence up to $250,000 for individuals and up to $500,000 for married couples. The 3.8% tax will only apply to capital gains above the normal exclusion.”
A more detailed explanation is provided by factcheck.org.
Bottom line, few home sellers will be impacted by this change.