What Are The Parameters Of The New Real Estate Tax?
First of all, it is a tax that will only be imposed on households with a combined income above $250,000 or individuals with an income above $200,000. Regardless of the transaction, this is the first stipulation that must be met and excludes about 97% of all U.S. households. From there, well you definitely get penalized for making good business decisions!The next stipulation is that you must make a return on the sale of the investment property above the capital gains threshold which is $250,000 for individuals and $500,000 for couples. That is a high threshold. At that point the tax does kick in, but only applies to the amount of income above the exclusion. For instance, if you sell a property and earn a $550,000 return as a couple, you will be subject to a 3.8% tax on $50,000 provided your adjusted gross income is above $250,000 for the year. If not, then there is no tax.Regards,
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