{
  "id": "RL32978",
  "type": "CRS Report",
  "typeId": "RL",
  "number": "RL32978",
  "active": true,
  "source": "CRSReports.Congress.gov, EveryCRSReport.com",
  "versions": [
    {
      "source_dir": "crsreports.congress.gov",
      "title": "The Exclusion of Capital Gains for Owner-Occupied Housing",
      "retrieved": "2022-03-05T04:03:31.942838",
      "id": "RL32978_10_2022-02-02",
      "formats": [
        {
          "filename": "files/2022-02-02_RL32978_45290abf37f104390b90c57264eb6d10e1f369e1.pdf",
          "format": "PDF",
          "url": "https://crsreports.congress.gov/product/pdf/RL/RL32978/10",
          "sha1": "45290abf37f104390b90c57264eb6d10e1f369e1"
        },
        {
          "format": "HTML",
          "filename": "files/2022-02-02_RL32978_45290abf37f104390b90c57264eb6d10e1f369e1.html"
        }
      ],
      "date": "2022-02-02",
      "summary": null,
      "source": "CRSReports.Congress.gov",
      "typeId": "RL",
      "active": true,
      "sourceLink": "https://crsreports.congress.gov/product/details?prodcode=RL32978",
      "type": "CRS Report"
    },
    {
      "source": "EveryCRSReport.com",
      "id": 341191,
      "date": "2007-12-26",
      "retrieved": "2016-04-07T03:53:13.313003",
      "title": "The Exclusion of Capital Gains for Owner-Occupied Housing",
      "summary": "For more than 50 years, capital gains on sales of taxpayers\u2019 homes have been preferentially treated. A revision in 1997 replaced two longstanding provisions\u2014a provision allowing capital gains tax deferral when a new residence was purchased, and a provision allowing a one-time exclusion of $125,000 for sellers over age 55\u2014with a capped exclusion for each sale. While the cap adopted in 1997 was higher than the cap for the over-age-55 sellers, it was less generous than the uncapped rollover provision. In addition, the dollar cap was not indexed for price changes, and, unlike the previous over-age-55 cap, was half as large for unmarried taxpayers\u2014$500,000 for married couples and $250,000 for single taxpayers.\nTwo factors in recent years, the rapid rise in housing prices and interest in tax reform, suggest the capital gains exclusion, including the dollar cap, might be reconsidered. In the 109th Congress, two bills were introduced to address this issue. H.R. 2127 would have allowed taxpayers over the age of 50 to double the current exclusion, once in their lifetime. H.R. 2757 would have indexed the exclusion to price changes. Other legislation (H.R. 3803 and S. 4075) was introduced to change the amount of the exclusion for surviving spouses to that of a married couple. In the 110th Congress, S. 138 was introduced to allow a surviving spouse to exclude up to $500,000 of gain from the sale or exchange of a principal residence owned jointly with a deceased spouse if the sale or exchange occurs within two years of the death of the spouse. That provision was also included in H.R. 3648, the Mortgage Forgiveness Debt Relief Act of 2007, which became public law (P.L. 110-142) on December 20, 2007.\nSome criticisms have been made that there are significant tax benefits for owner-occupied housing. Capital gains treatment is one of those benefits. Yet, there is an efficiency argument for eliminating or excluding a large portion of the gain on homes from tax. Capital gains taxes on homes create barriers to labor mobility in the economy. Imposing capital gains taxes on homes also creates significant compliance costs, requiring individuals to keep records for decades and to make fine distinctions between improvements and repairs. Capital gains taxes also tend to distort housing choices, discouraging individuals from selling their homes because of changing family and health circumstances. And, while the exclusion favors homeowners relative to renters, the taxation of gains in excess of a cap creates inequities between homeowners with different job circumstances, between those living in different parts of the country, and between those with different health outcomes. Exclusions of gains on homes do, however, contribute to tax avoidance schemes, especially ones that allow gains on investment properties to escape tax.\nThe current treatment of capital gains could be maintained. However, some consideration might be given to changing the dollar ceiling. One option is to eliminate the ceiling. Another option is to adjust the ceiling. This report examines the capital gains exclusion and the ceiling and will be updated to reflect legislative developments.",
      "type": "CRS Report",
      "typeId": "REPORTS",
      "active": false,
      "formats": [
        {
          "format": "HTML",
          "encoding": "utf-8",
          "url": "http://www.crs.gov/Reports/RL32978",
          "sha1": "4a41a7c08ed3d8452b0084f6fb3f538c2134576a",
          "filename": "files/20071226_RL32978_4a41a7c08ed3d8452b0084f6fb3f538c2134576a.html",
          "images": null
        },
        {
          "format": "PDF",
          "encoding": null,
          "url": "http://www.crs.gov/Reports/pdf/RL32978",
          "sha1": "7afb315051e7d3eae9d727d424cafa2d601fb277",
          "filename": "files/20071226_RL32978_7afb315051e7d3eae9d727d424cafa2d601fb277.pdf",
          "images": null
        }
      ],
      "topics": []
    }
  ],
  "topics": [
    "Economic Policy"
  ]
}