As a local real estate agent here in Tewksbury Massachusetts, I have been approached by many clients, friends and acquaintances about the 3.8% Transfer Tax on the sale of a home. They are in a panic thinking they should sell thier home before the tax is enacted Relax!! This is not an across the board tax to everyone who sells their home.
There is Health Care Legislation that created a new tax that would only apply to a portion of a gain on the sale of any capital asset (this includes real estate sales ). That tax will apply ONLY to individuals with more than $200,000 Adjusted Gross Income (AGI) or 250,000 for a joint income tax return. The tax will not apply to any amount excluded from taxation under the $250,000/$500,000 principal residence rules. The tax is never imposed directly on the full amount of any capital gain.
The tax is computed under a multi-step formula that captures only a portion of any capital gain and will only affect those with total Adjusted Gross Income above the amounts noted previously. The National Association of Relators has information on this topic. NAR’s Q&A on the tax and a brochure with examples of the tax