When I was holding an open house last weekend an woman came in to view the $2.25 million dollar home and started talking to me about how awful it was going to be for homeowners under “Obamacare” because hidden in the Health Care Reform Act, those “democrats” had snuk in a law that the federal goverment was going to tax every time a property was sold. I told her that I had never heard of such a thing but that if it was true then I’m sure the National Association of Realtors would make sure that that portion of the law would be amended. Curious and concerned, when I went back to my office I visited the website of the National Association of Realtors and found this headline: “Incorrect Rumors About 3.8% Transfer Tax Persist.”
Here’s what the Realtors group had to say: “For the third time in the past six months, NAR is being inundated with questions about a real estate transfer tax enacted as part of the Health Care reforms in 2010. THERE IS NO SUCH TAX. A viral Internet posting is riddled with errors.
“The Health Care legislation did create a new tax that would apply to a portion of the gain on the sale of any capital asset (including real estate). That tax will apply ONLY to individuals with more than $200,000 Adjusted Gross Income (AGI) (or $250,000 AGI on a joint return). The tax does not apply to any amount excluded from taxation under the $250,000/$500,000 principal residence rules. The tax is never imposed directly on the full amount of any capital gain The tax is computed under a multi-step formula that captures only a portion of any gain and will only affect those with total AGI above the amounts noted above …”
I hope this clears up the rumor. So if any of your friends of colleagues asks you about this tax, now you know its just one of those false rumors that the anti-Obama critics are spreading to make us all fearful and angry.