I want to get down to business with this blog – No I have not read the entire 33,000 page healthcare bill, nor the entire 20,000 pages of rules and regulations associated with the law!
But I do know what you need to know for your 2013 tax return!
What you need to know for 2013:
1. The individual mandate provision and premium tax credit do not affect your 2013 tax return.
2. For some – they could be affected by the additional Medicare tax, the net investment income tax, increased itemized thresholds, and exemption & itemized deduction phase-outs.
a. Net Investment Income Tax –
i. 3.8% additional tax on certain net investment income of individuals, estates, and trusts.
ii. For Married couples, this rate kicks in once Modified Adjusted Gross Income exceeds $250k.
iii. For Single taxpayers, this rate kicks in once Modified Adjusted Gross Income exceeds $200k.
b. Additional Medicare Tax –
i. .9% additional tax on wages, compensation, or self‐employment income exceeding threshold amounts.
ii. For Married couples, this rate kicks in once income exceeds $250k.
iii. For Single taxpayers, this rate kicks in once income exceeds $200k.
Call us today to discuss if this will impact you and to begin 2014 planning!
Derek C. Smith, CPA