(Boring but needed) Disclosure: This article is for informational purposes only and should not be considered legal or tax advice. Always consult with a qualified tax professional or financial advisor before making decisions related to your specific situation.
Could Capital Gains Taxes on Home Sales Be Going Away?
A new bill making headlines could bring big changes for homeowners across the country, especially those sitting on significant equity.
Earlier this month, lawmakers introduced the “No Tax on Home Sales Act,” a proposal that would completely eliminate capital gains taxes when selling your primary residence.
If passed, this would be one of the most impactful housing-related tax changes in decades, and it could mean keeping hundreds of thousands more dollars in your pocket when you sell.
What’s the law right now?
Under current tax law, when you sell your primary home, you can exclude up to $250,000 in profit from capital gains taxes ($500,000 for married couples filing jointly).
Any gain above that amount is taxed, often at long-term capital gains rates, which can take a big bite out of your proceeds.
For many long-time homeowners, especially those in markets like ours that have appreciated substantially, that tax bill can be painful.
What’s being proposed?
The new bill would eliminate capital gains taxes on home sales entirely.
That means:
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No limits on how much gain you can exclude
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No capital gains tax owed when selling your primary residence
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Potentially a major incentive for homeowners who have been hesitant to sell because of the tax hit
The idea behind the proposal is to fix what some are calling the “stay-put penalty.” Right now, many homeowners avoid selling, not because they do not want to move, but because they do not want to lose so much to taxes.
Why it matters
If this legislation moves forward, it could unlock much-needed housing inventory, help families rightsize or relocate more freely, and ease pressure on today’s tight housing market.
But it is still very early in the process. This is a proposal, not a law, and it may evolve significantly before anything becomes official.
What you can do now
Even under today’s rules, there are smart strategies to minimize or even completely eliminate capital gains when selling.
From timing the sale strategically to exploring certain reinvestment or trust options, the key is planning ahead, ideally before you list your home.
If you are thinking about selling in the next year or two and want to understand how this could affect you, I would be happy to walk you through your options and help you create a plan that protects your equity, no matter what happens with this bill.
Ben Hooson-Jones
Real Estate Planner | Next Chapter Real Estate Planners
Helping people build, protect, and pass on wealth through real estate.
NextChapterREP.com
