Yesterday afternoon, the wife and I went to see The Campaign. Maybe I’m giving Adam McKay too much credit, but there was a really smart, really funny underlying parody of how campaigns and politics in America are handled. To see the already absurd lifted to an even more absurd level was sublime.
And this leads to the real topic today: the 3.8 percent sales tax buried in the health care reform bill.
The National Association of REALTORS has a full breakdown on the realities of the tax; oddly enough, I consider this slightly more reliable than the chain e-mails making the rounds that have home sellers quivering at the thought of being taxed if they sell after the end of the year.
Here are the highlights of NAR’s summary …
- The 3.8% tax will never be collected as a transfer tax on real estate of any type, so you’ll never pay this tax at the time that you purchase a home or other investment property.
- You’ll never pay this tax at settlement when you sell your home or investment property. Any capital gain you realize at settlement is just one component of that year’s gross income.
- If you sell your principal residence, you will still receive the full benefit of the $250,000 (single tax return)/$500,000 (married filing joint tax return) exclusion on the sale of that home.
Seems clear enough, doesn’t it? Glad to see something in that health care bill does.