Obama Speaks & DOW Tumbles !!!

[LexusLover]

His chances in 2012 would improve if he would just keep quiet.

[CPT Savajo]

Definitely too many problems going on in Europe, actually BIG PROBLEMS!!! Plus theirs talk that Obama wants to implement the so-called "Buffet Rule" coupled with the lousy numbers already being reported in the U.S. If you add in a $447 billion spending spree in an attempt to create jobs that won't last things only seem to be getting worse.

I feel sorry for the people who still have trust in their 401(k)'s, who are getting their retirements robbed. I'm saying this for the people who take the approach of "fire and forget," who trusted a silver tounged salesman who told them "the market always goes up!" If the lost decade wasn't enough then keep your currency in your 401(k) until it's ALL GONE! Just leave it in there until it's evaporated! Then maybe you'll be happy! Don't let Wall St. via a government plan handle your money. Get your currency out, stop your contributions and manage it yourself. You'll probably end up doing a better job compared to giving your retirement away to someone you've never met before!

[Gotyour6]

Originally Posted by CPT Savajo

Definitely too many problems going on in Europe, actually BIG PROBLEMS!!! Plus theirs talk that Obama wants to implement the so-called "Buffet Rule" coupled with the lousy numbers already being reported in the U.S. If you add in a $447 billion spending spree in an attempt to create jobs that won't last things only seem to be getting worse.

I feel sorry for the people who still have trust in their 401(k)'s, who are getting their retirements robbed. I'm saying this for the people who take the approach of "fire and forget," who trusted a silver tounged salesman who told them "the market always goes up!" If the lost decade wasn't enough then keep your currency in your 401(k) until it's ALL GONE! Just leave it in there until it's evaporated! Then maybe you'll be happy! Don't let Wall St. via a government plan handle your money. Get your currency out, stop your contributions and manage it yourself. You'll probably end up doing a better job compared to giving your retirement away to someone you've never met before!

Most just dont know what they can do with it. They watch it go away and say "I lost $10,000" and ask what I lost. I say nothing because I moved it years ago and do my own investing now.

[Whirlaway]

Obama spoke and the DOW ended down 108 points; he really should just shut up !

He has become a joke. No serious minded people belive his BS anymore. He campgains that it isn't smart to raise taxes during a recession; but his plan outlines $1.5 trillion in new taxes !

[Laz]

It will be interesting to hear the anger when the tax on selling a house kicks in next year.

[LexusLover]

Originally Posted by Laz

It will be interesting to hear the anger when the tax on selling a house kicks in next year.

Especially when the IRS rules a deed in lieu of foreclosure is a sale!

[waverunner234]

Originally Posted by Whirlaway

Obama spoke and the DOW ended down 108 points; he really should just shut up !

Right before Obama spoke the DOW was down 217 points for reasons I told you earlier, can you do the math yourself or is that asked too much? Probably!
And another thing, I knew the DOW would have a down day before Obama even woke up this morning, and before the market opened. And I didn't know he was going to speak. Isn't that funny?

[CPT Savajo]

Originally Posted by Laz

It will be interesting to hear the anger when the tax on selling a house kicks in next year.

Can you elaborate on this a little bit more? What new tax on selling a house?

I understand that people get taxed harder for capital gains when selling a house, especially if it's in their name vs. cash flowing a property. Plus an individual selling a home in "their name" would get hit with bracket creep and would have to pay more in taxes since they would have to report more earned income.

[waverunner234]

Don't forget that the first $500,000 for a couple selling a home is tax free.
Above that is capital gain. But who is making more than half a million profit on their house in a market that is not really thriving? (Except from a few multi-millionaires selling a mansion)

[Laz]

I should have researched this a little more. It is not bad today but unless the 500,000 dollar exclusion is indexed for inflation, which is not mentioned in the article below, then it will apply to more and more people as time goes on. When the alternative minimum tax was first written it only effected a very small number of people.

We’ve been flooded with queries about this one ever since the health care bill became law. At the last minute, Democratic lawmakers decided on a new 3.8 percent tax on the net investment income of high-income persons. But the claim that this would amount to a $15,200 tax on the sale of a typical $400,000 home is utterly false.
The truth is that only a tiny percentage of home sellers will pay the tax. First of all, only those with incomes over $200,000 a year ($250,000 for married couples filing jointly) will be subject to it. And even for those who have such high incomes, the tax still won’t apply to the first $250,000 on profits from the sale of a personal residence — or to the first $500,000 in the case of a married couple selling their home.
We can understand how this misconception got started. The law itself is couched in highly technical language that only a qualified tax expert can fully grasp. (This provision begins on page 33 of the reconciliation bill that was passed and signed into law.) And it does say the tax falls on "net gain … attributable to the disposition of property." That would include the sale of a home. But 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. And the fact is, the first $250,000 in profit on the sale of a primary residence (or $500,000 in the case of a married couple) is excluded from taxable income already. (That exclusion doesn’t apply to vacation homes or rental properties.)
The Joint Committee on Taxation, the group of nonpartisan tax experts that Congress relies on to analyze tax proposals, underscores this in a footnote on page 135 of its report on the bill. The note states: "Gross income does not include … excluded gain from the sale of a principal residence."
And just to be sure, we checked with William Ahern, director of policy and communications for the nonprofit, pro-business Tax Foundation. "Some home sales would see a tax increase under this bill," Ahern told us, "but it would have to be a second home or a principal residence generating [a gain of] more than $250,000 ($500,000 for a couple)."
So there you have it. The sort of people who would have to pay the tax might include, for example:

• A single executive making $210,000 a year who sells his $300,000 ski condo for a $50,000 profit. His tax on the sale of that vacation home would amount to $1,900, in addition to the capital gains tax he would have paid anyway.
• An "empty nester" couple with combined income of over $250,000 a year who sell their $1 million primary residence to move to smaller quarters. If they cleared $600,000 on the sale, they would be taxed on $100,000 of the profit (the amount over the half-million-dollar exclusion). Their health care tax on the sale would amount to $3,800 over and above the usual capital gains levy.

However, a typical home sale would not incur any tax. In March, for example, half of all existing homes sold for $170,700 or less, according to the National Association of Realtors. Obviously, none of those sales could possibly generate a $250,000 profit, and so none would be subject to the tax.
Thus, for the vast majority, the 3.8 percent tax won’t apply. The Tax Foundation, in a report released April 15, said the new tax on investment income (including real estate) "will hit approximately the top-earning two percent of families" when it takes effect in 2013.
Footnote: Some of the chain e-mails that claim ordinary home sales will be taxed include a copy of an article written by Paul Guppy, a policy analyst with the conservative Washington Policy Institute (that’s Washington state, not Washington, D.C.). The article appeared March 28 as an op-ed in the Spokane, Wash., Spokesman-Review, and Guppy claimed that "[m]iddle-income people must pay the full tax even if they are ‘rich’ for only one day." That brought a quick rebuttal from Sara Orrange, the government affairs director of the local Realtors association. She wrote a letter to the newspaper calling Guppy’s article "inaccurate" and saying, "Most people who sell their homes will not be impacted by these new regulations. This is not a new tax on every seller, and that correction needs to be made." In a news article the next day, business reporter Bert Caldwell confirmed that only "a very few" home sellers would pay the 3.8 percent tax.
The Internal Revenue Service says that to qualify for the $250,000/$500,000 exclusion, a seller must have owned the home and lived there as the seller’s "main home" for at least two years out of the five years prior to the sale.

[onetime]

Thx for the explination Laz

[CPT Savajo]

Originally Posted by Laz

I should have researched this a little more. It is not bad today but unless the 500,000 dollar exclusion is indexed for inflation, which is not mentioned in the article below, then it will apply to more and more people as time goes on. When the alternative minimum tax was first written it only effected a very small number of people.

We’ve been flooded with queries about this one ever since the health care bill became law. At the last minute, Democratic lawmakers decided on a new 3.8 percent tax on the net investment income of high-income persons. But the claim that this would amount to a $15,200 tax on the sale of a typical $400,000 home is utterly false.
The truth is that only a tiny percentage of home sellers will pay the tax. First of all, only those with incomes over $200,000 a year ($250,000 for married couples filing jointly) will be subject to it. And even for those who have such high incomes, the tax still won’t apply to the first $250,000 on profits from the sale of a personal residence — or to the first $500,000 in the case of a married couple selling their home.
We can understand how this misconception got started. The law itself is couched in highly technical language that only a qualified tax expert can fully grasp. (This provision begins on page 33 of the reconciliation bill that was passed and signed into law.) And it does say the tax falls on "net gain … attributable to the disposition of property." That would include the sale of a home. But 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. And the fact is, the first $250,000 in profit on the sale of a primary residence (or $500,000 in the case of a married couple) is excluded from taxable income already. (That exclusion doesn’t apply to vacation homes or rental properties.)
The Joint Committee on Taxation, the group of nonpartisan tax experts that Congress relies on to analyze tax proposals, underscores this in a footnote on page 135 of its report on the bill. The note states: "Gross income does not include … excluded gain from the sale of a principal residence."
And just to be sure, we checked with William Ahern, director of policy and communications for the nonprofit, pro-business Tax Foundation. "Some home sales would see a tax increase under this bill," Ahern told us, "but it would have to be a second home or a principal residence generating [a gain of] more than $250,000 ($500,000 for a couple)."




So there you have it. The sort of people who would have to pay the tax might include, for example:

• A single executive making $210,000 a year who sells his $300,000 ski condo for a $50,000 profit. His tax on the sale of that vacation home would amount to $1,900, in addition to the capital gains tax he would have paid anyway.
• An "empty nester" couple with combined income of over $250,000 a year who sell their $1 million primary residence to move to smaller quarters. If they cleared $600,000 on the sale, they would be taxed on $100,000 of the profit (the amount over the half-million-dollar exclusion). Their health care tax on the sale would amount to $3,800 over and above the usual capital gains levy.

However, a typical home sale would not incur any tax. In March, for example, half of all existing homes sold for $170,700 or less, according to the National Association of Realtors. Obviously, none of those sales could possibly generate a $250,000 profit, and so none would be subject to the tax.
Thus, for the vast majority, the 3.8 percent tax won’t apply. The Tax Foundation, in a report released April 15, said the new tax on investment income (including real estate) "will hit approximately the top-earning two percent of families" when it takes effect in 2013.
Footnote: Some of the chain e-mails that claim ordinary home sales will be taxed include a copy of an article written by Paul Guppy, a policy analyst with the conservative Washington Policy Institute (that’s Washington state, not Washington, D.C.). The article appeared March 28 as an op-ed in the Spokane, Wash., Spokesman-Review, and Guppy claimed that "[m]iddle-income people must pay the full tax even if they are ‘rich’ for only one day." That brought a quick rebuttal from Sara Orrange, the government affairs director of the local Realtors association. She wrote a letter to the newspaper calling Guppy’s article "inaccurate" and saying, "Most people who sell their homes will not be impacted by these new regulations. This is not a new tax on every seller, and that correction needs to be made." In a news article the next day, business reporter Bert Caldwell confirmed that only "a very few" home sellers would pay the 3.8 percent tax.
The Internal Revenue Service says that to qualify for the $250,000/$500,000 exclusion, a seller must have owned the home and lived there as the seller’s "main home" for at least two years out of the five years prior to the sale.

A typical home sale isn't going to incur any type of taxation? I don't believe that. Isn't the current capital gains tax 15%? If a person sells their home for a gain that person should qualify for getting taxed on any gains am I right or wrong? Also, aren't short term capital gains taxes much higher (30-35%) where real estate flippers get punished for not being investors? On top of that every state is different because their could be state taxes involved as well as county taxes. The little man is always getting taxed, always have and always will. Have you ever heard of a 1031 tax deffered exchange where a real estate investor defers paying any taxes at all on a property while trading up in value? Why sell an asset unless someone just really needs the currency, or as in most cases a cash infusion to go on a spending spree?

[LexusLover]

If it's reinvested in another home within 6 months, doesn't that eliminate the gains tax?

[Laz]

Originally Posted by CPT Savajo

A typical home sale isn't going to incur any type of taxation? I don't believe that. Isn't the current capital gains tax 15%? If a person sells their home for a gain that person should qualify for getting taxed on any gains am I right or wrong? Also, aren't short term capital gains taxes much higher (30-35%) where real estate flippers get punished for not being investors? On top of that every state is different because their could be state taxes involved as well as county taxes. The little man is always getting taxed, always have and always will. Have you ever heard of a 1031 tax deffered exchange where a real estate investor defers paying any taxes at all on a property while trading up in value? Why sell an asset unless someone just really needs the currency, or as in most cases a cash infusion to go on a spending spree?

The tax laws benefit personal residence sales. Investment property has the same tax impact as any other investmant. The new tax would apply to investment property from dollar one so whatever tax is paid will increase by 3.8%.