# More Homes on the Market Act: Plain Language Summary

Right now, when you sell your home, the federal government lets you exclude a certain amount of profit from your taxes without paying capital gains tax on it. For a single person, that amount is $250,000, and for married couples filing jointly, it's $500,000. This bill doubles those numbers. Single sellers would get to exclude $500,000 in profits, and married couples would get to exclude $1,000,000. After 2024, these amounts would automatically increase each year to keep up with inflation, so they'd grow as the cost of living goes up.

The idea behind this change is straightforward: by letting people keep more of the money they make when selling their home, the bill's supporters believe homeowners will be more willing to sell and move to a different house. Right now, some people might hold onto their homes because they'd owe a big tax bill if they sold, even though they might want to move. If you're a homeowner planning to sell in the future, this could mean paying less in federal taxes on your profit. For example, if a married couple sells their home and makes $800,000 in profit, under current law they'd owe taxes on $300,000 of that gain. Under this bill, they'd owe taxes on nothing—the entire $800,000 would be excluded.

The practical effect the bill is aiming for is getting more homes onto the market. The theory is that if more homeowners feel comfortable selling without facing a huge tax bill, there will be more houses available for people to buy, which could help ease the housing shortage in many parts of the country. However, this also means less tax revenue for the federal government, since people will be paying less in capital gains taxes on home sales.

More Homes on the Market Act

Panetta, Jimmy

More Homes on the Market Act This bill increases the amount of gain from the sale of a principal residence that an individual may exclude from gross income (for federal tax purposes). Under the bill, an individual may exclude from gross income gain from the sale of a principal residence of up to $500,000 (currently $250,000), and taxpayers who are married and file a joint federal income tax return may exclude up to $1 million (currently $500.000).&nbsp;The bill also requires these amounts to be adjusted annually for inflation.