U.S. President Donald Trump meets with Philippine President Ferdinand Marcos Jr. (not pictured), within the Oval Workplace on the White Home in Washington, D.C., U.S., July 22, 2025.
Kent Nishimura | Reuters
President Donald Trump mentioned the administration is contemplating ending capital gains taxes on house gross sales to boost the housing market.
When requested concerning the thought within the Oval Workplace on Tuesday, Trump advised reporters, “we’re fascinated about that.”
“If the Fed would decrease the [interest] charges, we would not even have to do this,” he mentioned. “However we’re fascinated about no tax on capital features on homes.”
Below present regulation, house sellers can face capital gains taxes as soon as income exceed $250,000 for single filers or $500,000 for married {couples} submitting collectively.
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Trump’s feedback come roughly two weeks after Rep. Marjorie Taylor Greene, R-Ga., launched the No Tax on Home Sales Act, to remove capital features taxes on major house gross sales.
“Householders who’ve lived of their properties for many years, particularly seniors in locations the place values have surged, should not be compelled to remain put due to an IRS penalty,” she said in a statement. “My invoice unlocks that fairness, helps repair the housing scarcity, and helps long-term monetary safety for American households.”
Nevertheless, the proposal might be expensive, and it is unclear whether or not the measure has broad congressional assist, specialists say.
“I believe this might generate some curiosity, however they’re extra prone to increase the exemption than they’re to remove the tax totally,” Howard Gleckman, senior fellow on the City-Brookings Tax Coverage Heart, advised CNBC.
Who pays capital features on house gross sales
Enacted in 1997, the $250,000 and $500,000 capital features exclusions — which apply to major house gross sales — have by no means been listed for inflation.
Since 1997, the median house gross sales value has climbed by nearly 190%, from about $145,000 to roughly $417,000, as of the primary quarter of 2025, based on Federal Reserve information.
As house values rise, sure people, corresponding to longtime owners, usually tend to exceed the $250,000 and $500,000 thresholds, which might set off capital features taxes, specialists say.
When house gross sales income exceed $250,000 or $500,000, capital features are levied at 0%, 15% or 20%, relying on taxable earnings. Extra revenue above these thresholds can even set off the so-called net investment income tax of three.8%, relying on other investment earnings, based on the IRS.
Some 29 million owners (34%) might exceed the $250,000 threshold for single filers, and eight million (10%) might be above the $500,000 restrict for married {couples} submitting collectively, based on a 2025 study from the Nationwide Affiliation of Realtors, or NAR. The group has lengthy advocated for capital gains reform for house gross sales.
Householders in states like Washington, California, Utah and Massachusetts are more likely to be impacted, based on NAR information.
Nevertheless, many householders do not realize it is attainable to reduce your home sales profit by including so-called capital enhancements, corresponding to house renovations to the unique buy value, specialists say.
If capital features taxes for house gross sales had been eradicated, the measure would primarily profit sellers who’re older and wealthier, based on an analysis released Tuesday from The Funds Lab at Yale College.
