Selling a house may seem the natural step to many families looking to simplify life in reform, but reality is much more complex. The weight of taxes on real estate value has led thousands of owners to postpone the decision to put the real estate on the market, crashing personal plans and limiting housing supply in states where prices do not stop climbing.
Since 1997 the law in the United States has set a ceiling of exemption: up to $ 500,000 (about 420,000 euros) for couples and $ 250,000 (about 210,000 euros) for individual sellers. Above these values, a federal tax on the added value that can reach 20%applies.
After almost three decades, inflation and the climb of houses prices have pushed a growing number of families within this rule. Many, when they sell, end up delivering hundreds of thousands of euros to the state, says the digital newspaper Spanish noticias work.
When the house already “makes no sense”
This is the case of thousands of retired people who live in large houses, today too expensive to maintain. Many want to move to smaller spaces or senior communities, but the fear of losing a huge slice of value when selling the house leads them to postpone the decision. The situation has a direct impact on the market: fewer familiar houses are on sale, making it difficult to search young couples in states such as California, where prices are already the highest in the country.
Friedman example
Joel and Kathryn Friedman, both 71, live in southern California in a five -bedroom and 460 square meter housing. They invested about 1.8 million euros in the purchase of land, construction and improvement. Today, they plan to sell the house, which is valued at 4.5 million euros, according to the same source.
If they sold it, they would have a taxable value of about 2 million euros. The combined fiscal invoice, between federal and state taxes, would surround $ 700,000 (about 600 thousand euros), and could even exceed 800 thousand euros according to calculations by the National Association of Real Estate Agents.
For the couple, who have no heirs, this money is essential to finance reform and ensure future health care. Therefore, they prefer to expect the law to change before moving on with the sale.
Debate at the US Congress
The theme has been gaining strength in Washington. There are distinct proposals on the table: Republican Marjorie Taylor Greene advocates the total elimination of federal housing sales, while Democrat Jimmy Panetta proposes to double the $ 1 million exemption limit in the case of couples, with automatic inflation update, according to the same source.
Donald Trump has publicly stated that he studies the possibility of ending the tax, arguing that the measure could give a new momentum to the real estate market, waged by persistently high interest rates.
An still uncertain future
The experts, cited by, consider it unlikely that the total elimination of tax will advance, but believe that the increase in exemption limits would be sufficient to relieve pressure on owners and streamline the offer of houses. Still, they remember that the change would not solve all the problems of housing accessibility in the most expensive states.
While the debate continues, families like Friedman’s remain in too large and expensive homes for their needs, attached to a law that does not accompany the reality of the market.
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