Hidden taxes inside health care Bill
We have already lost so much in the value of our homes, many folks considered their home value part of their retirement package.....and now this......
How many more hidden items are there hidden in this bogus health bill?
When does your home become part of your health care? After 2012!
Your vote counts big time in 2012, make sure you and all your friends and family know about this!
HOME SALES TAX
I thought you might find this interesting, -- maybe even SICKENING!
The National Association of Realtors is all over this and working to get it repealed, -- before it takes effect. But, I am very pleased we aren't the only ones who know about this ploy to steal billions from unsuspecting homeowners. How many realtors do you think will vote Democratic in 2012?
Did you know that if you sell your house after 2012 you will pay a 3.8% sales tax on it? That's $3,800 on a $100,000 home, etc. When did this happen? It's in the health care bill, -- and it goes into effect in 2013. Why 2013? Could it be so that it doesn’t come to light until after the 2012 elections? So, this is ‘change you can believe in’?
Under the new health care bill all real estate transactions will be subject to a 3.8% sales tax.
If you sell a $400,000 home, there will be a $15,200 tax. This bill is set to screw the retiring generation, -- who often downsize their homes. Does this make your November, 2012 vote more important?
Oh, you weren't aware that this was in the ObamaCare bill? Guess what; you aren't alone! There are more than a few members of Congress that weren't aware of it either.
You can check this out for yourself at:
http://www.gop.gov/blog/10/04/08/obamac … taxes-home
I was sent this email and find it sickening that no one has informed the publicStacie,
What you and many others who just follow talking points is that they are already feeling the results of tax increases and fees imposed by Obamacare. Insurance rates have been rocketing up at a pace 3 times than they were before Obamacare became law. Why? Because of the taxes and regulations already imposed on them. Wait till you get your health insurance bill next year, there are a lot of regulations, fees and taxes going to hit the providers in January.
Its funny you brought this up now, I wrote about this a year ago and had a forum thread back then and was relentlessly attacked as I posted about all the problems that was going to cost us big, and more is coming down the road.I likewise got an email, which said in part,
"The per person Medicare Insurance Premium will increase from the present
Monthly Fee of $96.40, rising to:
$104.20 in 2012
$120.20 in 2013
And
$247.00 in 2014.
These are Provisions incorporated in the Obamacare Legislation, purposely
delayed so as not to confuse the 2012 Re-Election Campaigns. Send this to
all Seniors that you know, so they will know who's throwing them under the
bus."
Yep, they're going to more than double the premium in a single year.
For many people on SS, this will mean the equivalent of dog food time...
Not true:
http://www.snopes.com/politics/taxes/realestate.asp
The health care bill imposes a 3.8% transaction tax on profits over the capital gains threshold. The threshold is currently $500,000.
So if you bought a home for $200k and sold it for $750k you'd pay 3.8% of $50k which is $1900.
Still slipped in an extra tax - but not as 'nasty' as being advertised.Not Quite. From the actual Obamacare act. As you can clearly see, the threshold set is $250,000, half that if single or married filing separately. Also take note that it taxes estates and trusts which have always been tax exempt.
What many do not realize is this not only hurts the regular homeowner, but those who invest in real estate. There are many who buy homes to flip or hold onto as rental properties. This law hurts that industry.
Also, the law applies to Net investment incomes as well.
CHAPTER 2A--UNEARNED INCOME MEDICARE CONTRIBUTION
"Sec. 1411. Imposition of tax.
"Sec. 1411. IMPOSITION OF TAX.
"(a) In General.--Except as provided in subsection (e)--
"(1) Application to individuals.-- In the case of an individual, there is hereby imposed (in addition to
any other tax imposed by this subtitle) for each taxable year a tax equal to 3.8 percent of the lesser of--
"(A) net investment income for such taxable year, or
"(B) the excess (if any) of--
"(i) the modified adjusted gross income for such taxable year, over
"(ii) the threshold amount.
"(2) Application to estates and trusts.-- In the case of an estate or trust, there is hereby imposed (in
addition to any other tax imposed by this subtitle) for each taxable year a tax of 3.8 percent of the lesser of-
-
"(A) the undistributed net investment income for such taxable year, or
"(B) the excess (if any) of--
"(i) the adjusted gross income (as defined in section 67(e)) for such taxable year, over
"(ii) the dollar amount at which the highest tax bracket in section 1(e) begins for such taxable year.
"(b) Threshold Amount.--For purposes of this chapter, the term 'threshold amount' means--
"(1) in the case of a taxpayer making a joint return under section 6013 or a surviving spouse (as
defined in section 2(a)), $ 250,000,
"(2) in the case of a married taxpayer (as defined in section 7703) filing a separate return, 1/2 of the
dollar amount determined under paragraph (1), and
"(3) in any other case, $ 200,000.And this is how misinformation travels - we both are right in a way....
I'm trying to simplify.
You add the amount for profit less 500k to your gross income.
If gross income is now greater than 250k then you pay 3.8% on the lesser of either:
a) the amount you exceed 250k
b) the actual tacable income gained on the sale of house (profit less 500k).
So someone with 225k income who gains 50k profit (after 500k deduction) would pay 3.8% of 25k.
Someone with 275k income who gains 50k profit would pay 3.8% of 50k
Someone with 50k income who gains 50k profit would pay no tax.
Here's a full analysis from realtor.org (they should know!):
http://www.realtor.org/small_business_h … _broch.pdfSimey,
I am not sure why you keep going back to the $500,000 figure. The bill defines the threshold in what I posted above
"(b) Threshold Amount.--For purposes of this chapter, the term 'threshold amount' means--
"(1) in the case of a taxpayer making a joint return under section 6013 or a surviving spouse (as
defined in section 2(a)), $ 250,000,
"(2) in the case of a married taxpayer (as defined in section 7703) filing a separate return, 1/2 of the
dollar amount determined under paragraph (1), and
"(3) in any other case, $ 200,000.
I do not know what realtor knows or does not know. I have always said real estate agents blow more deals than they close.
I use to be very involved in real estate investments, properties, built homes and commercial work. While due to my health I have not been involved for about 5 years, I still know people involved. I told one friend I knew wanted to retire and sell off his properties. I told him last year that tax was coming and if he meant it he needed to dump them before the end of last year. He was able to sell most, but there were a number of properties that sold this year. He was taxed on 6 of those sales and while I do not know the sales price, I know none of them were for anywhere near $500,000.Did you read any of the links I gave you?
Taxable Income for Capital Gains are definded as being the profit you make from a sale less $500,000. So if you sell a house for $600,000 that cost you $50,000 - the taxible income is $50,000. This is added to gross income.
At this point if you have gross income greater than 200k you can have an additional tax of 3.8%. It is the lessor of:
-Total gross income above $250k
-Taxable Income due to capital gain
It's a little more complicated than that - but the realtor.org PDF goes through all the examples.http://taxes.about.com/od/taxplanning/q … le_tax.htm
"Individuals can exclude up to $250,000 in profit from the sale of a main home (or $500,000 for a married couple) as long as you have owned the home and lived in the home for a minimum of two years. Those two years do not need to be consecutive. In the 5 years prior to the sale of the house, you need to have lived in the house for at least 24 months in that 5-year period. In other words, the home must have been your principal residence."
I made the assumption of a married couple.
As the article is aimed at scaring home owners, I took the applicable law relating to home owners. Most home owners are not in the business of retail homes.
The point I am arguing is "What many do not realize is this not only hurts the regular homeowner,"
A regular homeowner has to be earning over $200k and realize a profit of more than 500k....
I agree this is a lot worse for retail investors...SC,
I have no idea where you got the live in the home for two years from but that does not exist. I have included two link below that back up what I posted right from the bill, one is from the Senate, a pretty credible source.
I think I know part of your misunderstanding. You are believing married couples are $500,000 when they are $250,000, it is 1/2 if they file taxes seperately and $200,000 for single people.
I talked to several people after I last posted including the gentleman I posted about earlier. Each one have sold properties and know first hand what the tax implications are, they said it is as I have posted above.
http://www.naiopmn.org/pdfs/HealthCareB … nation.pdf
http://dpc.senate.gov/healthreformbill/healthbill63.pdfThe 500,000 has nothing to do with income - it's the 'free' profit you are allowed when calculating Taxable income on the sale of a house.
If you buy a house for $100,000 and sell it for $650,000 you make a profit of $550,000 - but only $50,000 is taxable for a married couple.
The $200,000 or $250,000 amount you quote is for taxable income including this.
The differences we have are that the people you are talking about are selling investment properties - where I am talking about people selling their own home - it's completely different.
Again - read the realtor.org information I posted - they are the National Association of REALTORS and are providing information for all realtors in the country.
The 'live in the home for two years' is again for Taxable Income from sale of a home - and it is not in the bill because it has its own well established legislation.
Here's the official IRS reference for the 500,000 (look under gain)
http://www.irs.gov/businesses/small/ind … 21,00.html
See the section Ownership and use tests the two years out of five rule I mentioned.
Now I think that the IRS is a legitimate source? agreed?
We are arguing different points - you point out that the person income must exceed 200k or 250k - I don't dispute that - what I dispute is that you do not use the sale price of the house in any tax calculation - you only use the Taxable Income from sale of the house when it increases the taxable income over the limits you mention.
Please read the realtor.org it explains it a lot better than me!SimeyC
Thank you for sending that. You are calculating taxes as they have always been done on the sale of a home. Notice the dates they use in there example. The tax you are showing is taxed at whatever your income rate is, notice they refer you to your 1040 Schedule D. This money goes to the IRS then to the general fund.
This tax is a different tax over and above your income tax, they are seperate. The 3.8% tax goes into Medicare, not the IRS or the general fund
From the bill:
" In the case of an individual, there is hereby imposed (in addition to
any other tax imposed by this subtitle) for each taxable year a tax equal to 3.8 percent of the lesser of-"
Notice where it says in addition too. There is a 3.8% tax on the sale of a home. as was pointed out.Read the information from Realtor.org.
This IS NOT a tax on the sale of the home - there is an ADDITIONAL tax on the extra taxable income from the sale of the house. In my example the tax may be on the $50,000.
The law on taxable income relating to sale of property HAS NOT been changed.
Look up the law relating to earned income and how that is calculated when adding sales profit - it IS REDUCED by $500,000 on the sale of the first house.
This BILL does not change this law it creates a 3.8% tax on the earned income above $250,000.
I state again there is NOT The a 3.8% tax on the sale of a home - there IS a 3.8% on taxable income relating to the sale of a home - that's a very huge difference.
Taking from your previous post:
"(A) net investment income for such taxable year, or
"(B) the excess (if any) of--
"(i) the modified adjusted gross income for such taxable year, over
"(ii) the threshold amount.
Note (i) - modified adjusted gross income. Sale of property is not gross income. It is currently calculated as the profit on sale less $500,000 allowance for married couples - this not changed in the Bill.I am not American View, I am an investor in property, I am his friend and he is letting me use his computer. he told me about how you see the tax increase. You are seriously misinformed as to the Medicare tax. I am telling you from personal experience, AV has it right. The Medicare tax is in addition to taxable capital gains calculated by the method you are referring. To put it simply, on several properties I sold this year I made 3.8% less than if I sold it last year. Now this tax does not apply to all the properties I sold, some of them the revenues were to low to tax. The threshold for me is $200,000 as I am a single entity.
Simey,
You need to get off the realtor.com example. They are wrong about the $500,000 married cap, it is $250,000, if they are filing seperate as my copy of the bill shows, it is $125,00. If the number was 500,000 as you say than the filing seperate would be 250,000.
By the way, where do you think that revenue come from that is being taxed? It comes from a sale of a home,The tax is on the profit revenues if you want to call it that, which is laid out in the original post from the bill.
Using your scenario, you buy a house for 100,000, sell it for 650,000 after the 200,000 threshold you will pay 3.8% to medicaid on 350,000 , yet under IRS code you will also pay 15% tax on 50,000 , for a total tax paid of 20,800.The view you give is from an investor in property. I AM NOT DISPUTING THAT.
You are WRONG about how the 3.8% tax is applied to sale of home for a normal home owner. Simple as that.
I am not going to respond anymore because you simply refuse to budge.
You are saying that the laws on calculating Taxable Income for sale on property have changed - they have not.
You are saying that realtor.org are wrong - if they are then the whole realtor industry are in for a shock because they are advising homeowners incorrectly and will get sued.
AGAIN - when a homeowner (who is not an investor in property) sells a house the taxable income is calculated (for a married couple) as:
Net Profit less $500,000.
This is added to Taxable Income.
The 3.8% is applied to the lower of:
a) The amount of taxable income above 250k
b) The taxable income on the sale of the property.
While I am not disputing the amounts you show for an investor in property, you are completely wrong for a homeowner.
End of story.Simey,
When you sell your home and if the sale falls into the parameters and you get taxed, I will be here to say told you so.
My friend came by to visit me last night when I told him and he wanted to respond. While it is true he will sell more property than the average person, it applies to everyone but you refuse to see it.
I live in an area that is very transient. There are many corporate headquarters here. There are many job transfers, lots of homes sold. I have a friend in the real estate division of EDS. He told me back when the law came out that corporations like his were unhappy because his company pays everything associated with a relocation. They have to now eat that tax as well.
You are not understanding what I am saying, I am not saying that the IRS taxable income on a home sale has changed, I am not saying that, nothing has changed there. The problem is you refuse to acknowledge that the 3.8% tax is in addition to that IRS tax and has different threshold such as $ 250,000 as is shown in the law, rather than $500,000. .I agree that the 3.8% is an additional tax - never said it wasn't.
I disagree with the way you are calculating the 3.8% tax on the WHOLE sale of the house - that is simply not the case for the first home you sell.....
Again - on the first sale a house by a home owner the Taxable Income (for married couples) is:
Sale Price less purchase price less 500,000.
So you say you pay 3% on profit, I say profit less than 500k
Example - Cost: 100,000, Sale Price: 650,000.
Your tax: 3.8% x 550,000 = 20,900
My tax: 3.8% x 50,000 = 1,900
Again I am not disputing that this is an additional tax.
If you are a regular homeowner that sells two houses then you would pay the 3.8% on the full profit. Again - look at the IRS site I sent you - THAT law is not changing - YES there is a 3.8% tax...
We are talking about different things - the 500,000 is the amount ANY home owner can deduct on their first home sale when calculating Taxable Income from the sale of the home!!!! I cannot make it any plainer...
I AM NOT DISPUTING THE ADDITIONAL TAX, NOR AM I DISPUTING YOUR THRESHOLDS FOR TAXABLE LIMITS!
Here's another organization that agree with me:
http://www.factcheck.org/2010/04/a-38-p … your-home/
See "the bill also says the tax falls only on that portion of any gain that is "taken into account in computing taxable income" under the existing tax code."
Again see my above remarks about how to calculate taxable income on the sale of your first home and my prior links to the IRS.
Here's a comment from a conservative, socially liberal republican:
http://www.mortgagenewsdaily.com/channe … ntals.aspx
Now here's one:
"Beginning January 1, 2013, ObamaCare imposes a 3.8% Medicare tax on unearned income of “high-income” taxpayers which could apply to proceeds from the sale of single family homes, townhouses, co-ops, condominiums, and even rental income, depending on your individual circumstances and any capital gains tax exclusions." - note the 'any capital ganis tax excusions' - hmmm that's the $500,000 I'm talking about. Now even you cannot say this source is incorrect:
http://www.gop.gov/blog/10/04/08/obamac … taxes-home
I wouldn't be surprised by any politicians attempting to raise taxes through a bill nor would I be surprised that some politicians will actually try to give tax breaks also via bills.
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