The fear mongers have struck again! As troubling as the current real estate market is for sellers, the last thing we need is artificially produced fear. People can get really worked up over politics, twisting the truths to suit their needs. Let’s bring a little sanity to the table.

Email #1:
Have you received an email with the following example content?

“Under the new health care bill – did you know that all real estate transactions are subject to a 3.8% “sales tax”? You can thank nancy, harry & barack (and your local congressman) for this one. If you sell your $400,000 home, this will be a $15,200 tax.”

Read the analysis by FACTCHECK.ORG, Summary:
THE CLAIM IS FALSE.

Let us sum up: The health bill included a provision that imposes a new 3.8 percent Medicare tax for some high-income households that have “net investment income.” Any revenue collected by the tax is dedicated to the Medicare hospital insurance program.

This new tax applies only to households with Adjusted Gross Income (AGI) of more than $200,000 for individuals or more than $250,000 for married couples. Since capital gains are included in the definition of net investment income, an additional tax obligation might result from the sale of real property.

Even if the AGI limits are met, the new tax would not be applied to capital gains that result from the sale of a home, since the existing home sale capital gains exclusion rule still applies – $250,000 (individual)/$500,000 (couple). So if the gain from the sale of the primary residence is below that amount, then NO Medicare tax will have to be paid on the gain. The new Medicare tax would apply only to a home sale gain realized in excess of the $250K/$500K that pushes the filer’s AGI over the $200K/$250K income limits.

Some other quick points:

• The new Medicare tax will take effect January 1, 2013.
• The legislation makes no changes to the mortgage interest deduction.

E-Mail #2:
Regarding the passed Cap and Trade Energy bill. Email in part:

“This bill prevents you from selling your home without the permission of the EPA administrator. To get this permission,you will have to have the energy efficiency of your home measured. Then the government will tell you what your new energy efficiency requirement is and you will be forced to make modifications to your home under the retrofit provisions of this Act to comply with the new energy and water efficiency requirements.

Then you will have to get your home measured again and get a license (called a “label” in the Act) that must be posted on your property to show what your efficiency rating is; sort of like the Energy Star efficiency rating label on your refrigerator or air conditioner. If you don’t get a high enough rating, you can’t sell.”

Read the analysis by FACTCHECK.ORG, Summary:
THE CLAIM IS FALSE.

The bill does set new national efficiency standards for new residential and commercial buildings. Those standards are outlined in Section 201. But only homes constructed after the bill became law would have to meet them, not currently existing homes.

Nothing in the bill requires homeowners to obtain an energy license, or retrofit their house to meet energy standards as a condition of sale. That’s something the House Committee on Energy and Commerce mentioned more than once in its summary of the legislation.

NAR (National Association of Realtors) produced a nice 2-page flyer busting these 2 email myths and can be downloaded here.