The role of the federal capital gains tax in housing affordability

When you sell a home, the profit you make is taxed. It’s called the capital gains tax. You can exclude a portion of that profit from taxes – up to $250,000 for a single person or $500,000 for a married couple. Some housing experts and politicians think changing the capital gains tax on home sales could motivate more homeowners to sell, and open up homes amid a national housing shortage.

WUWM’s series, Seeking Solutions: Keys to Homeownership, examines barriers to home buying and possible solutions. WUWM’s Race & Ethnicity Reporter Teran Powell speaks with UW-Madison professor of Urban Planning, Kurt Paulsen, to learn more about the capital gains tax and how reforming it could affect housing in Wisconsin.