Donald Trump Considers Eliminating Capital Gains Tax on Houses

US President Donald Trump says he is considering eliminating the capital gains tax on houses, according to a Tuesday briefing. Trump says that the main thing holding back a potential elimination of the capital gains tax is a lack of interest rate cuts. “If the Fed would lower the rates, we wouldn’t even have to do that,” Trump told reporters in the Oval Office. “But we are thinking about no tax on capital gains on houses.”

Capital gains tax is a tax on the profit you make from selling a capital asset, such as investments like stocks, bonds, or real estate. This tax is levied when you sell the asset for more than its cost basis. According to the IRS, the current rates are 0%, 15% or 20%, depending on taxable income and filing status. However, Trump appears adament that he wants to remove all of the Capital gains taxes, but must see more Fed interest rate cuts to do so. Under current law, filers can exclude as much as $250,000 from taxable income on capital gains made on primary homes.

About 13 million households—or 15% of homeowners—potentially exceed the cap, according to a study commissioned by the National Association of Realtors.

US House Representative Marjorie Taylor Greene recently proposed the “No Tax on Home Sales Act.” The bill proposes eliminating federal capital gains taxes on the sale of primary residences to provide relief to homeowners. While the bill sounds promising for homeowners, it could prove dangerous for future federal tax revenue and exacerbate house affordability issues for medium and lower-income households.

Also Read: Donald Trump’s Tax Bill Brings US Tax Reform — What It Means for Your Wallet

Trump’s tax plan has stirred plenty of controversy among government officials and citizens, particularly around the “Big Beautiful Bill.” This comprehensive US tax reform impact makes the 2017 tax cuts permanent while also introducing new exemptions. The elimination of capital gains taxes on houses would be the latest in Trump fulfilling those campaign promises of tax cuts for those making the most in the United States.