PROPOSED Tax Changes in Housing to Address Affordability

What Housing Tax Proposals Are Actually on the Table?

Housing affordability has pushed tax policy back into the spotlight. However, it’s important to separate enacted law from policy discussion.

Capital-Gains Exclusions for Buyers

There is no current legislation allowing first-time buyers to exclude capital gains on investments for down payments.
This idea appears mainly in policy discussions and think-tank frameworks.

First-Time Buyer Tax Credits

Several bills propose refundable credits between $10,000 and $15,000.
These are more targeted and politically viable, though none have passed.

Capital-Gains Inflation Indexing

Some conservative lawmakers support taxing only “real” gains.
However, divided government makes passage unlikely.

Home-Sale Exclusion Modernization

The Section 121 exclusion has not changed since 1997.
While widely discussed, no increase or elimination has been enacted.

Retirement Account Access

Current law allows limited IRA withdrawals.
Proposed expansions exist, but they are not yet law.

Puget Sound Perspective

In higher-cost markets, these discussions matter.
Still, buyers and sellers should plan using today’s rules, not future possibilities.

Please confirm the information above with your CPA.