Cape Coral real estate investors note the 3.8% tax

Cape Coral real estate investors note the 3.8% tax

Cape Coral real estate investors, learn the facts about the 3.8% tax on investments. Try a search on the internet on the 3.8% real estate tax and you’ll find thousands of articles about what the 3.8% tax is and how it applies to your real estate investments. However, be cautious because a lot of the articles are untrue and misleading.

The tax didn’t just come along. It was added into the health care legislation back in 2010.

The National Association of Realtors published a document to address the most common questions investors have in regard to the 3.8% tax. It may not be what you think. Click here to open the pdf from NAR on the 3.8% real estate tax. We want to be sure to help our Cape Coral real estate investor customers get the facts needed to make an educated decision on their real estate investments.

For instance, the tax is NOT paid when buying or when selling. It is a tax paid when you file your income taxes, not a real estate transfer tax. In Lee County we do not have a huge transfer tax. In most cases the seller pays the doc stamps on the purchase price amount to the county along with the recording fees. It is customary for the buyer to pay for the doc stamps relating to their mortgage (if not paying cash). For more information on the typical closing costs for a purchase here in Lee County click this link.3.8% tax on real estate investments

  • When do you pay the tax?

The tax goes into affect in 2013. It is figured during tax time. NOT at the purchase or sale of a property.

  • Who is taxed?

The tax only applies to single income earners over $200,000 or married over $250,000 (married filing separately is $125,000 each). So if your total annual income is less than either you do NOT need to worry about this tax. If real estate investing is your primary occupation you will not have to pay. If you earn more than these amounts you will only be taxed on the income ABOVE the $200,000 or $250,000 amounts.

  • What is taxed?

The 3.8% tax applies to capital gains, rents, interest or dividends. So not just real estate.

  • What about the primary residence exemption, did this change it?

No, married couples are still able to exempt up to $500,000 on a primary residence and up to $250,000 for singles regardless of their incomes.

* Please note that these are my interpretations of the 3.8% tax based upon reviewing the information that the National Association of Realtors published. I am NOT a tax advisor and strongly urge you to contact your tax professional to learn how this tax will, or won’t, affect you personally.


As always, should you have ANY real estate questions do not hesitate to call or email us for more information. We look forward to working with you.

To get started you can start your online search now for Cape Coral property or fill out our contact form to have an agent contact you right away about Cape Coral real estate!

We look forward to working with you!

We also work with sellers of real estate in Cape Coral. If you own a Cape Coral waterfront or off water property and would like to see it featured here; please let me know. We are looking for realistic sellers who want to get the most out of their property within a reasonable timeframe. We also handle short sales in Cape Coral.

Yours in Success,

Susan Milner, REALTOR Broker/Owner ~ e-PRO, GRI, SFR, CDPE, and (TRC) TransNational Referral Certification

Florida Future Realty, Inc

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(239) 542-8521

I’m always looking to hire more motivated and professional licensed Florida real estate agents. If you are interested in learning more about Florida Future Realty, Inc. feel free to contact our office at 1222 SE 47th Street, Cape Coral, FL 33904, via phone at 239-542-8521, online at Cape Coral Real Estate Career or via email at Susan Milner, the broker in charge & owner of Florida Future Realty, Inc. can also be reached on her personal cell phone at (239) 218-2229. All contact will remain strictly confidential.

Unless otherwise noted all content Copyright 2012 Susan Milner.

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