So let us take some time to not only investigate incomplete propaganda about a non-health related issue that was snuck into the health care law, but let us also look at the dishonest and disingenuous ways that our politicians (yes, of BOTH flavors) craft new laws:
First, let us look at the text of a viral email going around about one of the "stealth provisions":
Propaganda Email wrote:Did you know that if you sell your house after 2012 you will pay a 3.8% sales tax on it?
That's $3,800 on a $100,000 home etc.
When did this happen? It's in the healthcare bill. Just thought you should know.
SALES TAX TO GO INTO EFFECT 2013 (Part of HC Bill)
REAL ESTATE SALES TAX
So, this is "change you can believe in"?
Under the new health care bill - did you know that all real estate transactions will be subject to a 3.8% Sales Tax? The bulk of these new taxes don't kick in until 2013 (presumably after obama's re-election). You can thank Nancy, Harry and Barack and your local Democrat Congressman for this one. If you sell your $400,000 home, there will be a $15,200 tax. This bill is set to screw the retiring generation who often downsize their homes. Is this Hope & Change great or what? Does this stuff makes your November and 2012 votes more important?
Oh, you weren't aware this was in the obamacare bill? Guess what, you aren't alone. There are more than a few members of Congress that aren't aware of it either (result of clandestine midnight voting for huge bills they've never read). AND, there are a few other surprises lurking.
OK, so that's the hype and propaganda. And as usual, it is partially true, but does not tell the whole story. When you go to Politifact
, you can read:
Politifact wrote:Q: Does the new health care law impose a 3.8 percent tax on profits from selling your home?
A: No, with very few exceptions. The first $250,000 in profit from the sale of a personal residence won’t be taxed, or the first $500,000 in the case of a married couple. The tax falls on relatively few — those with high incomes from other sources.
So it is true, but the propaganda email left out some important points. Points that some would say make it acceptable, but I would not go that far. I just say it is less burdensome than the propaganda says it is. But look further in the Politifact article and you will see what I wish to point out:
Politifact wrote: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.)
So before I address the underhanded ways our politicians craft the verbiage of laws, let us just look at the burden of this tax:
1) It has NOTHING TO DO WITH health care (except taxing SOME people even more to try and pay for it).
2) It is targeting a market that is already on life support, and which has been the primary cause of our current recession, and this market shows no real signs of recovery, with a very real risk of further home devaluations.
3) This tax is in addition to the existing capital gains taxes one already pays on proceeds from a home sale (double dipping).
4) Since the exclusion is not laid out in this law, but rather indirectly related via another law, all one has to do is change the exclusion in the other (capital gains) law, and one can get away with a second "stealth tax". Understand what I just said: Politicians can come along after 2013 (or even before) and decide to take away the exclusion dollar amount for capital gains on home sales. And at that point, without many people realizing it, it would cause ALL home sales to be subject to this 3.8% tax on ALL net gains....no exclusion allowed.
But now pay attention to the part I underlined in the Politifact passage from above. This is the part that makes me want to revolt against out system and the politicians who game it. If a reasonable person, with a reasonable level of literacy, cannot plainly, easily, and CORRECTLY interpret the words of a law, but must, instead, hire someone and pay them money to tell them what the law really means to them... then is this not enough evidence that we have a "ruling elite class" who is actively trying to keep us from understanding what they are doing to us?"
Answer: Of course this is such evidence. And it is, definitely, the stuff that revolutions are made of. And it makes my blood boil!!!