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Intro
Beginning January 1, 2013,
a new 3.8 percent tax on some investment income
will take effect. Since this new tax will affect some real estate transactions, it is
important for REALTORS® to clearly understand the tax and how it could impact
your clients. It’s a complicated tax, so you won’t be able to predict how it will
affect every buyer or seller.
To get you up to speed about this new tax legislation, the NATIONAL
ASSOCIATION OF REALTORS® has developed this informational brochure.
On the following pages, you’ll read examples of different scenarios in which
this new tax — passed by Congress in 2010 with the intent of generating
an estimated $210 billion to help fund President Barack Obama’s health care
and Medicare overhaul plans — could be relevant to your clients.
Understand that this tax WILL NOT be imposed on all real estate transactions,
a common misconception. Rather, when the legislation becomes effective in 2013,
it may impose a 3.8% tax on some (but not all) income from interest, dividends,
rents (less expenses) and capital gains (less capital losses). Te tax will fall only
on individuals with an adjusted gross income (AGI) above $200,000 and couples
filing a joint return with more than $250,000 AGI.