Federal Sales Tax on Sale of Home

[Full Throttle]

Am I the only one that missed this when the bill was passed? I had breakfast with a client of mine this morning and he told me about it (and he's in the auto repair business!):

Q: Does the new health care law impose a 3.8 percent tax on profits from selling your home?
A: No, with very few exceptions. The first $250,000 in profit from the sale of a personal residence won't be taxed, or the first $500,000 in the case of a married couple. The tax falls on relatively few — those with high incomes from other sources.

It doesn't affect that many people, but the press never picked it up as far as I could tell.

 

[leevena]

Yes, there is a tax on home sales. The answer you pasted in your question makes me laugh, because the answer begins with "no", which is not correct.

Yes, the tax is 3.8%, for filers who earn $200k single, $250 married. The 3.8% tax is applied to the profit on the house sold, with the first $250k excluded from the tax for single, and the first $500k for married.

There are also some additional restrictions/exlcusions and the way it looks now, it will apply to mostly 2nd homes. But like all taxes, this is always subject to changes in the future.

 

[AndreaSti]

Yes, there is a tax on home sales. The answer you pasted in your question makes me laugh, because the answer begins with "no", which is not correct.

Yes, the tax is 3.8%, for filers who earn $200k single, $250 married. The 3.8% tax is applied to the profit on the house sold, with the first $250k excluded from the tax for single, and the first $500k for married.

There are also some additional restrictions/exlcusions and the way it looks now, it will apply to mostly 2nd homes. But like all taxes, this is always subject to changes in the future.

Who is making a profit on home sales these days? The way things are going, not many people will owe this tax.