SOURCE: Engel & Volkers

Engel & Volkers

October 07, 2010 11:17 ET

Engel & Volkers Say the Tax Man Cometh

SCARSDALE, NY--(Marketwire - October 7, 2010) -  And according to Jonathan Lerner, managing director of Engel & Völkers, the picture isn't going to be pretty, especially if you're a home owner thinking of selling.

"I think a lot of people still don't realize that starting on January 1, 2011, the Bush tax cuts are going to phase out, and the capital gains tax is going to go through the roof," Lerner said. "This has very serious tax implications for anyone who is thinking about selling a home in the future."

Lerner notes that the current capital gains tax is at 15%, but after the first of the new year it rises to 20%. "That's a huge jump, and it's going to impact a lot of people who plan to sell their homes down the road," Lerner said. "In some cases the additional tax burden will take tens-of-thousands-of-dollars from the home owner's profit from the sale, and send those dollars down to Washington D.C."

What to do? Lerner said that he's advising his clients who have been thinking about selling their homes, to put them on the market immediately. "We, like other real estate firms, have clients who have been talking about down-sizing and turning the profit from the sale of their home into retirement generating income. For these folks the new tax will be a double whammy. Their profit will be substantially lowered and they'll have less money to put into retirement funding. That's going to hurt."

Depending on market conditions it can take time to sell a home, so Lerner believes the sooner a property can get listed the better chance it has of being sold before the new capital gains tax hike takes effect. "If you're one of those people who have been thinking about selling, but putting it off, now you have a compelling reason to call up your real estate broker and get your home listed. Come next year, that money will look a lot better in your pocket than it will in Uncle Sam's," he says.

Engel & Völkers / Scarsdale property shop is located at 300 Heathcote Road in Scarsdale. The firm has over 574 locations located on 5 continents in 37 Countries.

Contact Information

  • ADDITIONAL INFORMATION:
    Jonathan B. Lerner
    Engel & Volkers
    300 Heathcote Road
    Scarsdale, NY 10583
    914-723-5555
    Email Contact