Tax tips with Christopher Arunkumar – AVS TV

The American Taxpayer Relief Act (2012 Taxpayer Relief Act)

Congress passed into Law on January 02, cost 2013 sweeping Tax Law changes effecting tax Years 2012 (current year) and effective 2013 onwards.

14 Things you should know before you do your Taxes.

  • The individual Tax rates for 2013 are 10%, viagra 60mg 15%, approved 25%, 28%, 33%, 35% & 39.6%.
  • The top tax rate for Capital Gains will permanently rise to 20%.
  • AMT exemption will be indexed for inflation after 2012. AMT exemption amounts for Joint $78,750 & $50,600 for 2012.
  • Beginning 01/01/2013 certain high income individuals, trusts and estates are subject to surtax on “unearned income”. The surtax is also referred to the “unearned income on Medicare contribution tax”. The tax is 3.8% on the lesser of net investment income (NII) or excess of MAGI over the applicable threshold.
  • Social Security wage base in 2012 was $110,00 and in 2013 is $113,700
  • Federal Estate Tax rate was 35% is now 40% for 2013 and it is annually adjusted for inflation exclusion of $5 million. 2012 $5,120,000 & 2013 $5,250,000.
  • The Annual gift tax exclusion in 2012 was $13,000 and in 2013 is $14,000
  • Foreign earned income exclusion limit was $95,100 in 2012 and in 2013 is $97,600
  • The adoption credit/assistance is projected to be $12,700 for 2013.
  • ATRA excludes the provision for one year, through 2013 income from cancellation of mortgage debt on principal residence of up $2 million.
  • ATRA extends the provision through December 31, 2013 Mortgage Insurance Premiums as deductible interest on qualified residence interest.
  • ATRA states the maximum allowable interest deduction for student loan deductible is $2,500.
  • ATRA extends through 2013 a provision excluding from income cancellation of mortgage debt on a principal residence of up to $2 million. This exclusion does not apply to vacation properties or rental properties.
  • The employee portion of the hospital insurance tax part of FICA, normally 1.45% of covered wages, is increased by 0.9% on wages that exceed a threshold amount. The additional tax is imposed on the combined wages of both the taxpayer and the taxpayer’s spouse, in the case of a joint return.