Thursday, April 22, 2010

Health care and more taxes

Is this really true?
Tax on Home Sales. Imposes a 3.8 percent tax on home sales and other real estate transactions. Middle-income people must pay the full tax even if they are “rich” for only one day – the day they sell their house and buy a new one.
That would be $7,600 for a $200,000 home--on top of Realtor fees! This would make it very hard for most people to sell their homes even if they are not among the millions who now owe more on their home than its worth!

But that's apparently just the tip of the tax iceberg. Read more in "Health Law's Heavy Impact."

2 comments:

Owen said...

Does the new law override the capital gains exemption on the sale of your home?

http://www.irs.gov/taxtopics/tc701.html

Kevin said...

The massive new wave of taxes is terrifying, it will drain the economy and expand the government's power. The specificity of the taxes is also concerning; a 10% sales tax on tanning? That type of tax is intended to manipulate the market; tanning is deemed bad for your health and luxury so the they tax it. It's no different then cigarettes or alcohol really; it will just be easier to add these types of taxes especially when the medical programs are insolvent and politicians target the wicked people whose unhealthy habits cost us all, they should pay (as long as we don't enjoy those unhealthy habits of course). This of course will also hurt the economy... increased taxes at tanning salons increase the cost to consumers which means they will purchase fewer tanning sessions which means you need fewer employees, fewer salons, fewer beds.

The editorial doesn't provide any usable citations so the claims can't be easily verified or clarified. I suspect the house tax is on the profits made by selling the home not the cost of the house. Either way, it will reduce the cash people have to purchase new homes so they'll be less likely to sell and will mean that repeat buyers will have less cash to buy homes which will keep housing prices down. How much the market is slowed is anyone's guess.