Real Estate Tax in Heathcare Bill

There is a real estate tax in the Heathcare Bill, called the Medicare Tax, because the benefits go to Medicare.

Many are up in arms over the 3.8% tax that would have to be paid.

Luckily for most Americans, this tax DOES NOT APPLY.

From Factcheck.org:

…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.

If you are married, you would only pay on PROFITS over $500,000 on your personal house that you sell. And that’s only IF you make $250,000 or more each year in income. Right now, you already can’t be taxed on your primary residence for this amount, and that remains true.

Washington Post columnist Benny L Kass, who also happens to be an attorney, reiterated much of the same information in his recent post:

First, it is not a sales tax, nor does it impose any transfer or recordation tax. It is called a Medicare tax because the money received will be allocated to the Medicare Trust Fund, which is part of the Social Security system.

So, please don’t worry. The Health Care and Education Reconciliation Act of 2010′s “real estate tax” will not effect most Americans. Those who will be are in the top 2% of income earners in the US, and won’t be affected until 2013.

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