How to cope with new Medicare surtax — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

How to cope with new Medicare surtax

by on
in Small Business Tax,Small Business Tax Deduction Strategies

Chances are, if you’re a high-income taxpayer, the scheduled 2013 tax rate increases on ordinary income (salaries, self-employment income, interest, and so forth) and capital gains and dividends aren’t your only concern. You could also face a new 3.8% Medicare surtax on all or part of your net investment income.

Strategy: Make your tax moves now. If you wait until the surtax kicks in next year, it may be too late. Several of the strategies for minimizing the 3.8% Medicare surtax may also coincide with efforts to lighten your tax load under the new tax rate structure for 2013. Thus, you can kill two birds with one stone.

Here’s the whole story: Beginning in 2013, the new 3.8% Medicare surtax applies to the lesser of “net investment income” (NII) or the excess of modified adjusted gross income (MAGI) over the applicable threshold. The MAGI threshold is $200,000 for single filers and $250,000 for joint filers (see below). The "...(register to read more)

To read the rest of this article you must first register with your email address.

Email Address:

Leave a Comment