GTAX Gilman Ciocia Explains Changes in Tax Laws

If you make more than $250,000, you will have a tax increase on investment income of an additional 3.8% in 2013. The dividend tax rate changes to the taxpayer's ordinary income tax rate in 2013. Previously it was taxed at 15%. The maximum tax on dividends and interest will be 43.8%, and Medicare tax for those making $200,000 or more will increase by 0.9% as part of the Affordable Care Act.

Gift Tax Exclusions and Rates

Beginning in 2013, the annual gift exclusion increases from $13,000 to $14,000. Spouses may combine their gifts to raise the annual exclusion to $28,000. The tax rate on gifts in excess of the exclusion limits will increase from 35% to 55%. If you did not make significant gifts by the end of 2012, you should strongly consider enlisting the help of Gilman Ciocia tax planning services to make the most of your particular situation.

FICA and Medicare Withholding

The FICA withholding from your paycheck will increase from 4.2% to 6.2% in 2013, and the Medicare withholding rate will increase from 1.45% to 2.35%. People who are self-employed are not exempt from this increase, which will show up in the self-employment tax that independent contractors and those who are self-employed must pay.

Tax Filing in 2013 Could Get Messy

Because of the delay in legislation by Congress at the end of 2012, the 2013 filing season is likely to be more complex than usual. The Internal Revenue Service (IRS) will have to change their computer systems in order to accommodate changes in the tax law, which could delay filing of tax returns for many people.

GTAX Gilman Ciocia Can Help with Year-Round Tax Planning

With a tax code as complicated and contentious as that in the U.S., prudent taxpayers can make the most of their income tax situation by enlisting in the help of Gilman Ciocia tax planning services. Over your lifetime, taxes are your biggest expense, and a high percentage of tax filers overpay their taxes. Knowing your real tax liability is one of the keys to making the most of your income, regardless of how much you make.