Clarification on Healthcare Sales Tax on Real Estate

There is a lot of misinformation that has been circulating on the Internet and in e-mails that the healthcare reform bill passed last year includes a sales tax on real estate. This is false information, and I’d like to clarify the issue. The new law imposes a 3.8 percent 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 percent tax only applies to capital gains above the normal exclusion. A typical home sale will not incur any tax, and for the vast majority, the 3.8 percent tax won’t apply.

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