Like much you hear from the Radical Right, there is an element of truth to it, meaning it's not quite a pure fabrication. But it will not affect everyone who sells. If you are a "high earner (less than 5% of us) AND have a profit of $500000 on the sale of your home, you will be taxed at 3.8% of the amount OVER $500000 that you earned. So, say you are a "high earner", sold your home for $1.5M and half of that was profit (not bad, eh?), you will then owe 3.8% of $250000 ($750000 profit less $50000) or $9500, which equals a tax of .0063% on the total transaction. If that applies to you, in my opinion, you can afford it!