3.8% Sales Tax on All Real Estate Sales!

Have you received a chain email like this:

This should help stimulate the Real Estate market! UNDER THE NEW HEALTH CARE BILL – DID YOU KNOW THAT ALL REAL ESTATE TRANSACTIONS ARE SUBJECT TO A 3.8% “SALES TAX”? YOU CAN THANK NANCY, HARRY & BARACK (AND YOUR LOCAL CONGRESSMAN) FOR THIS ONE.
IF YOU SELL YOUR $400,000 HOME, THIS WILL BE A $15,200 TAX.

Please, settle down and don't shout! The purveyors of this email can only wish the health care bill were this evil. According to factcheck.org and snopes.com, this tax only applies to people with income exceeding $200,000 per year. If the seller has lived in the house for two of the last five years, the first $250,000 in capital gains for a single person and $500,000 in capital gains for a married couple is tax free. Only the capital gains in excess of those amounts will be taxed at 3.8%.

Sales of vacation homes and investment properties are not exempt from this tax.

Most of us can't even dream about $250,000 in capital gains on the sale of our homes. This bill will generate so little tax revenue, and it has predictably created so much rumor fodder, I don't see why it was ever tacked on to the health care bill.