Under the Affordable Care Act, otherwise known as the Healthcare Bill, there is a 3.8% tax on certain profits related to or arising under the disposition of property. Yes, this could include the sale of your home. However, it must be clear that the additional tax is only applicable to certain individuals.

The tax falls on “net gain attributable to the disposition of property.” But, the tax only applies to the portion of any gain that is taken into account in computing taxable income under the existing Tax Code. Under the Internal Revenue Code, the first $250,000 in profit on the sale of the primary residence (or $500,000 in the case of married couples) is excluded from taxable income. Therefore, unless the profit exceeds $250,000 or $500,000 for a married couple, the additional tax would not be applicable. It is also important to note in order for the $250,000/$500,000 exclusion to apply, the seller must have owned the home and lived there as the seller’s main home for the last two years of the five years prior to the sale.

Therefore, to summarize, there is a new tax applicable to certain dispositions of property. In addition, this tax could attach to sales of the primary residence. However, based upon the provisions of the Internal Revenue Code, this additional new tax would only be applicable to a select few sellers.