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Heritage
Foundation
Morning Bell:
13 Tax Increases in 2013
By Curtis Dubay
January 8, 2013
New Year’s Day was tough for taxpayers. Thirteen tax increases kicked
in.
The deal that Congress and President Obama struck that finally—but only
partially—avoided the fiscal cliff resulted in seven tax increases.
Those hikes combined with six tax increases from Obamacare that also
began on New Year’s Day.
13 Tax Increases That Started January 1, 2013
Tax increases the fiscal cliff deal allowed:
1. Payroll tax: increase in the Social Security portion of the payroll
tax from 4.2 percent to 6.2 percent for workers. This hits all
Americans earning a paycheck—not just the “wealthy.” For example, The
Wall Street Journal calculated that the “typical U.S. family earning
$50,000 a year” will lose “an annual income boost of $1,000.”
2. Top marginal tax rate: increase from 35 percent to 39.6 percent for
taxable incomes over $450,000 ($400,000 for single filers).
3. Phase out of personal exemptions for adjusted gross income (AGI)
over $300,000 ($250,000 for single filers).
4. Phase down of itemized deductions for AGI over $300,000 ($250,000
for single filers).
5. Tax rates on investment: increase in the rate on dividends and
capital gains from 15 percent to 20 percent for taxable incomes over
$450,000 ($400,000 for single filers).
6. Death tax: increase in the rate (on estates larger than $5 million)
from 35 percent to 40 percent.
7. Taxes on business investment: expiration of full expensing—the
immediate deduction of capital purchases by businesses.
Obamacare tax increases that took effect...
Read the rest of the article at the Heritage Foundation
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