Aug 07, 2012
Yet again, NAR debunks "3.8% tax"
07 Aug 2012
Posted by Andrew Kantor
People are still not getting it, so NAR has put out yet another debunking of the “3.8% real estate tax” myth that continues to circulate.
This one is a one-pager that explains (again) what this Medicare capital gains tax is, and why it hardly ever will apply to real estate:
The 3.8% tax will NEVER be collected as a transfer tax on real estate of any type, so you’ll NEVER pay this tax at the time that you purchase a home or other investment
You’ll NEVER pay this tax at settlement when you sell your home or investment property. Any capital gain you realize at settlement is just one component of that year’s gross income.
Please help debunk this myth. We keep having to explain it, and we keep getting mail to the effect of “I received this from one of my agents? Is it true?” referring to a frantic message about ‘a new tax on the sale of every house!!!’