Both individuals and businesses have investments, ranging from investment securities to business furniture, equipment and real estate. The tax rules for these investments are many and complex. I help my clients maximize their wealth by taking advantage of all the rules.
EFFECT OF NEW TAXES AND RATES
2013 surprises include a new 20% capital gains rate on gains of taxpayers in the 39.6% bracket. There is a new 3.8% net investment income tax. This new tax is paid, on the lesser of (1) net investment income or (2) modified adjusted gross income (MAGI) exceeding thresholds of $250,000 (joint filers), $125,000 (married separate filers), and $200,000 (single and HOH filers). So, together, these taxes spell a top tax rate on long term investment gains as high as 23.8% in 2013.
Investment assets not used in business operations include stocks, bonds, mutual funds and other securities. The income from these investments may include dividends and interest income. In addition, you may have gains or losses from sales of these investments. Long term gain (from securities held 12 months or more) is generally taxed at no more than 20%, as are qualilfied dividends. Keeping taxes low on investments is frequently a matter of timing. But watch out for the Medicare surtax.
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