• A Tax Increase on the Highest Incomes of 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) have 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%.
   
• Higher Personal Exemptions Phase-out Levels.  The phase-out levels for personal exemptions and itemized deductions are back and start at $300,000 for married couples and surviving spouses and $250,000 for individuals.
   
• Permanent AMT Inflation Indexing.  The alternative minimum tax originally was intended to prevent high-income individuals from avoiding taxes.  After years of last-minute AMT "patches", the new law permanently indexes the AMT to inflation starting in tax year 2012.  For income you earned in 2012, the exemptions are $50,600 for individuals and $78,750 for married taxpayers filing jointly.
   
• Restoration of the Full Rate for Social Security and Medicare Taxes.  The law did not extend the 2% cut for the employees' portion of the Social Security payroll tax, which means it will go back to the full rate of 6.2% on income up to $113,700 in 2013.
   
• Marriage Penalty Relief Retained.  Certain taxpayers filing jointly will no longer have to worry about paying more than if they filed as single taxpayers; joint filers also will enjoy a larger standard deduction.
   
• Education Tax Benefits Extended.  Many deductions for the education expenses were set to expire at the end of last year, but they will remain in place under the new law.  For example, the law extends the deduction for qualified education expenses through 2013 and retroactively for the 2012 tax year.
   
• Conversions to Roth Retirement Plans.  The new law allows participants in an employer-sponsored 401(k) to transfer any amount to a Roth 401(k) - the funds will be taxed upon conversion.
   
• Clarity on Estate and Gift Taxes. After years of uncertainty in this area, the new law holds the estate and gift-tax exclusion at $5 million, indexed for inflation ($5.12 million in 2012). The top rate increased to 40% from 35% as of Jan. 1, 2013, but without this change, it would have soared to 55% with a $1 million exclusion amount. The act also made permanent the estate tax portability election, which allows a surviving spouse to use a deceased spouse's unused exemption amount.

It should also be noted that beginning in 2013 taxpayers who have net investment income will face a 3.8% surtax on categories of certain unearned income, potentially increasing the total tax rate to 43.4%.  This tax was already slated to go into effect as a result of health care reform. The surtax applies to unearned income for taxpayers with an adjusted gross income above $200,000 for single and $250,000 for joint filers.