New ObamaCare Taxes Revealed
by Tax Rascal
Categories: Business, Economy, Featured, Personal Finance, Politics, Tax News, Tax Policy, Uncategorized
When Nancy Pelosi was Speaker of the House, she famously quipped that Congress would have to pass the 2010 omnibus healthcare bill in order to find out what was in it. Congress complied, and now America is starting to find out what is inside the bill come law: taxes, taxes and more taxes.
The Internal Revenue Service recently released new rules for investment income taxes on capital gains and dividends earned by so-called “high income” payers.
Enter: the first surtax to be applied to capital gains and dividend income at 3.8%. But the surtax is more complicated than it seems, because it applies to a broad range of investment securities such as stocks, bonds, commodity securities, specialized derivatives and more.
In addition, the new regulations also include a 0.9% healthcare tax on wages for individuals who make $200,000 or more per year and $250,000 or more for joint filers.
The IRS offered the following example: an individual filing their taxes and a single person with an annual wage of $180,000 also makes $90,000 from investment income making their modified adjusted gross income $270,000.
The 3.8% surtax applies to the $70,000 (above $200k) meaning the individual would have to pay Uncle Sam $2,660 for the privilege of being an investor.
If this isn’t bad enough, the rules remain unclear about exactly which forms of investment income will be taxed under Obamacare’s surtax. For example, will rental income be taxed at the same rate? Considering how shaky the real estate market remains, this is a very real and important question that needs answering.
If you have any questions about how this new surtax may affect you or need help with your taxes this coming season, be sure to visit www.RapidTax.com and contact any of our experts.