Instead of sitting back and waiting for events to unfold, you can take action now to protect yourself if the Buffett rule, or some variation of it, works its way into the tax law.
Here’s the whole story: The Buffett rule is based on the concept that everyone, regardless of his or her station in life, should pay a “fair” share of the federal income tax burden. It was initially proposed by billionaire investor Warren Buffett, who last year paid an effective tax rate that was claimed to be lower than his secretary’s.
The Obama administration stands behind the basic premise to levy a minimum 30% tax rate on taxpayers earning at least $1 million a year.
In other words, if the Buffett rule is enacted, you could use perfectly legitimate tax strategies to whittle down your tax liability, but you’ll still be hit with a top tax rate of no less than 30%.
6 steps to counter higher taxes
In this case, the best defense may be a good offen...(register to read more)