By Chesley Payne
For the Tribune
Real Estate: A New “Sales Tax”?
I am often contacted by people concerned about things they see and hear in the media. There is a lot of misinformation out there regarding a variety of topics. The most recent topic of concern is a new “sales tax” on the sale of real estate. Fortunately, the fear of a new tax is unfounded for most people, but, like some rumors, there is some factual basis. Currently, people selling their personal homes can exempt up to $250,000 of net proceeds from the sale of their personal residence if they are single and $500,000 if they are married. This has not changed. There is a change for those who receive net proceeds over and above these amounts. These individuals may be subject to an additional 3.8% tax on top of their normal capital gains tax rate on these proceeds if the individual makes more than $200,000/year if they are single or $250,000/year if they are married. This 3.8% additional tax is not expected to affect most homeowners. However, this is a fairly complicated issue and should not be addressed without discussing these items with your attorney or tax professional.
Debt Collectors: There Are Limits!
Another bit of misinformation that arises regards threats from bill collectors. I have heard stories of bill collectors threatening to garnish wages or have debtors thrown in jail. The Fair Debt Collections Practices Act is a law that places limits on the steps bill collectors can take in pursuing a debt. Bill collectors cannot contact you at work and are not allowed to contact you at all hours of the day. Further, a bill collector is not allowed to threaten criminal prosecution in the collection of a civil debt. Also, before your wages can be garnished, you must be served with a lawsuit and given your day in court
. It is unfortunate that rouge bill collectors make these particular laws necessary. However, your local attorney can be a resource to determine the proper path to take in many situations and separate facts from myths.
Mr. Payne earned his B.A. degree from the University of Alabama in 1999 and his J. D. degree from the University of Alabama in 2002. He is a member of the Alabama State Bar. His practice areas include Civil Litigation; Real Estate; Commercial Transactions.