Understanding Our Changing Tax Codes

tax code The US Tax codes change, and they aren’t necessarily changing in your favor. Congress failed to act right after the year and now So there’re changes headed towards us. The biggest things you can expect to see is an increase in social security from 2percentage to 2 -a 2 increase. Everyone’s income tax is going up across the board, at least 4percentage and even more through the middle class -the 15 tax bracket is going up to 28 and 25 and 28 brackets to 31 and 36 respectively -expect a leaner 2013 for the already struggling middle class. Anyway, the child tax credit has been cut intending to increase from 15 to 20percent and in the realm of less good news dividends are now being taxed as regular income with a top rate of 39 dot 6percentage.

For those who are wondering what’s going on with the AMT -it’s still around.

Exemptions are 33750 for singles and 45000 for couples.

tax codeThe estate tax will increase from 35percent to 55percent in the highest bracket and the exclusion amount should be reduced to 1 million dollars, down from the 2012 5 amount million. Your education and tax extender tax breaks are also getting slashed. Following tax breaks will no longer be available. Teachers’ classroom expense deduction, state and local sales tax deduction, ‘tax free’ charitable IRA distributions for those 70 and older, higher education tuition deduction, business RD credit, and 15year depreciation for leasehold improvements and restaurant property. For example, what this means for you overall is higher taxes, harder work, and hopefully a raise from your employer being that you’re certainly intending to need it.

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