TAX PLANNING FOR THE NEW MEDICARE TAXES

The health care reform legislation enacted in 2010 significantly broadens the Medicare tax base for higher-income taxpayers by enacting two new taxes. Beginning in 2013, higher- income taxpayers will be subject to an additional 0.9% tax on earned income and a new 3.8% tax on investment income. This...

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Bibliographic Details
Published inPractical Tax Strategies Vol. 88; no. 4; p. 148
Main Author Koski, Timothy R
Format Trade Publication Article
LanguageEnglish
Published Boston Thomson Reuters (Tax & Accounting) Inc 01.04.2012
Subjects
Business income
Couples
Employees
Employers
Estimated taxes
Excise taxes
Federal legislation
Health care policy
Investment income
Medicare
Partnership interest
Self employment
Tax base
Tax planning
Taxpayers
United States > US
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Summary:The health care reform legislation enacted in 2010 significantly broadens the Medicare tax base for higher-income taxpayers by enacting two new taxes. Beginning in 2013, higher- income taxpayers will be subject to an additional 0.9% tax on earned income and a new 3.8% tax on investment income. This article reviews these new taxes and discusses tax planning strategies associated with them. The new 0.9% tax on earned income and 3.8% tax on net investment income will increase the tax burden of higher- income taxpayers beginning in 2013. Taxpayers and their advisors should begin planning now in order to minimize the impact of these taxes in 2013 and beyond.
ISSN:1523-6250