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 in the fiscal cliff deal:
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 via blog.heritage.org
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