U.S. Representatives Mike Kelly (R-PA) and Jimmy Panetta (D-CA) reintroduced the bipartisan More Homes on the Market Actto address ongoing housing affordability issues across the country. The legislation would amend the tax code to incentivize more homeowners to sell their houses and increase the market supply.
Summary of the More Homes on the Market Act:
- The current tax code allows homeowners who sell their home to exclude $250,000 in gains from capital gains taxes, or $500,000 in the case of a joint-filing couple.
- The current exclusion amount was first set in 1997 and was not indexed to inflation. If it had been indexed for inflation, it would be $461,325 for single filers and $922,650 today.
- The More Homes on the Market Act increases the exclusion to $500,000 for single filers and $1 million for joint filers.
- Increasing this exclusion will make it easier for homeowners to sell, getting more homes on the market and increasing housing supply.