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Upcoming Due Dates
January 31, 2013
All Businesses
Deadline to mail 1099s and W-2s for 2012 to recipients (due to Governments end of February)
February 11, 2013
Employees Who Work for Tips
If you received $20 or more in tips during January, report them to your employer
February 15, 2013
Individuals
If you claimed exemption from income tax withholding last year on the Form W-4, you must file a new Form W-4 by this date to continue your exemption for another year
February 28, 2013
All Businesses
Send copies of 1099s and W-2s to governments along with withholding reconciliations
A new tax law was born, right along with the new year — and some of the provisions could affect your 2012 federal income tax return.
Learn more here...
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Wow, what a ride for nothing. Aren’t we the best at kicking the can down the road? I’m afraid all of the aggravation during the last few months was just a preview of things to come. The tax increases that went into effect this month will not put a dent into the financial challenges that our country faces so look for big fights later in the year as our leaders address spending. Here’s a look at the impact on individuals. Contact us if you have any questions on how these changes may affect you.
- A Tax Increase on the Highest Incomes in 2013. Although most taxpayers avoided a tax increase, rates did rise for top earners. Taxpayers (including those who receive income through partnerships and S corporations) who earn more than $400,000 ($450,000 for married taxpayers filing jointly) are back to a marginal tax rate of 39.6%. All other existing rates remain the same.
- Higher Capital Gains Rates for Top Earners. The same individuals who are subject to the new 39.6% top rate on income now face a 20% rate on capital gains and dividends, up from 15%. Taxpayers in the 10% and 15% income brackets have a zero capital gains rate and those in the middle will continue to pay 15%. These rates apply to holdings of greater than one year. Short term gains carry the higher ordinary rates.
- Higher Personal Exemptions Phase-out Levels. The phase-out levels for personal exemptions and itemized deduction have been raised to $300,000 for married couples and surviving spouses and $250,000 for individuals. At this income point, your itemized deductions begin to shrink creating a higher effective tax rate without raising your tax bracket.
- Permanent AMT Inflation Indexing. The alternative minimum tax originally was intended to prevent high-income individuals from avoiding taxes.
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