As part of the Obamacare screw-job, At the last minute, Democratic lawmakers decided on a new 3.8 percent tax on the net investment income of high-income persons. But the claim that this would amount to a $15,200 tax on the sale of a typical $400,000 home is utterly false.
The truth is that only a tiny percentage of home sellers will pay the tax. First of all, only those with incomes over $200,000 a year ($250,000 for married couples filing jointly) will be subject to it. And even for those who have such high incomes, the tax still won’t apply to the first $250,000 on profits from the sale of a personal residence — or to the first $500,000 in the case of a married couple selling their home.
The Internal Revenue Service says that to qualify for the $250,000/$500,000 exclusion, a seller must have owned the home and lived there as the seller’s "main home" for at least two years out of the five years prior to the sale.
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Don't forget that a plumbing company with just a few employees incorporated as an LLC could easily reach the limit where such a tax would kick in. The individual and "corporation" file under a single return.
ReplyDeleteMaybe I missed something....
This is another foot in the door of new taxes. Soon the dumbocrats will be taxing the air we breathe
ReplyDeleteJust as expected, comments that are plenty light on the facts and heavy on the bull jive.
ReplyDelete4:15, look it up, although many small businesses fall into the same scenario, very few of them fall into the 250,000 category. Yeah there is a possibility, but not very likely.
7:17, the post fact checked a myth. What have you offered besides fluff.