If you have been fretting about the rumored addition of a 3.8 percent sales tax increase on Birmingham new homes due to Obamacare, then you can take a deep breath. Come 2013, home sales will not be hit with this tax.
According to the National Association of Home Builders (NAHB), the new tax added by the health care reform law is an add-on to existing taxes on capital gains and other unearned income such as dividends, rents and interest. Currently, capital gains are taxed at a 15 percent rate, and only those will an adjusted gross income above $250,000 ($200,000 for single returns) will face the additional 3.8 percent tax.
However, for home sales, the current $500,000/$250,000 gain exclusion for a seller of a principal residence remains. Therefore, most principal residences sales will not be affected. For example, suppose the capital gain for a home that sells for $500,000 after being purchased for $200,000 is $300,000. The seller did not receive more than $500,000 of gain, so he or she is excluded from the tax increase.
At Harris Doyle Homes, we know that purchasing a new home is a big decision and we want you to have all of the facts. Buying a home now does not mean that we will have to pay more in the future. In fact, it is an investment in your future.
As a trusted Birmingham home builder, we’re here to help you purchase your dream home. We build new homes in six communities throughout the Birmingham area that fit the needs of a variety of buyers.
For more information on Harris Doyle Homes, please visit our website.