Is The Rumor Fact or Fiction?

Rumor Number One

The new "Cap and Trade" Climate change bill in Congress requires a homeowner to license their home prior to selling it.
FICTION!

There is no requirement in the law to license a home before your clients are allowed to sell their home. In addition, there is not a requirement to make a home more energy efficient before it can be sold.


Rumor Number Two

The recently-passed health care legislation imposes a 3.8% tax on homes sales.
FICTION!

An article has been circulating that mischaracterizes and overstates what is actually in the legislation. Here are the facts.
There is a new 3.8% Medicare tax for "High Income Filers" that goes into effect January 1, 2013 The tax is on unearned income and will apply ONLY to single filers with more than $200,000 of Adjusted Gross Income (AGI) and joint filers with more than AGI of $250,000. Unearned income includes interest, dividends, capital gains and net rents.
Keeping in mind the income limitations above, real estate income that will be affected for high-income filers include:
• Sale of a primary residence: If the gain from the sale of the property is below $250,000 (individual)/ $500,000 (couple) NO tax will have to be paid on the gain. The new Medicare tax would only apply to any gain realized over the $250K/$500K existing primary home exclusion that will bring the filers AGI over the $200K/$250K limits.
• Second Home/Investment property: The additional 3.8% tax will apply to the portion of the gain realized on the sale of a second home or investment property that will bring the filers AGI over the $200K/$250K limit.
• Rental Income: The portion of net rental income that exceeds the $200K/$250K AGI limits will be subject to the new 3.8% tax.