The gist

Seniors 65+ pay no capital gains tax when selling a home worth $500,000 or less to a first-time buyer. Goal: free up starter homes.

Who wins, who loses

• Wins: senior homeowners downsizing, first-time buyers searching for affordable starter homes.
• Loses: federal tax revenue; investors and repeat buyers who get no break competing for the same homes.

What it does

• Adds Section 121A to the Internal Revenue Code (IRC), excluding sale gains from gross income.
• Caps eligible sale price at $500,000; buyer must sign perjury statement confirming first-time status.
• Applies to sales after December 31, 2026; expires December 31, 2031.
• Replaces, not stacks with, the existing Section 121 home-sale exclusion.

Why should I care?

Supporters say this unlocks starter homes stuck with empty-nesters, helping young buyers crack a brutal market. Critics argue the $500,000 cap excludes most homes in expensive cities, and the tax break mostly rewards sales that would happen anyway. An alternative being debated: direct down-payment grants to first-time buyers. Where do you land? Vote below and use "Tell Your Rep" to make sure your voice reaches Congress.