2013 Brings Two New Taxes to High Income Taxpayers
With the fiscal cliff stealing the spotlight over the holidays, very little attention was given to two new taxes that started January 1. Thanks to the Affordable Care Act (also known as Obamacare) the first wave of tax increases rolls out in 2013 to help fund the massive 2010 health care reform. The new taxes on wages and investment income are expected to raise about $318 billion over 10 years. Granted the bulk of these taxes fall mainly on the wealthy and the health care industry, but sooner or later we will all be paying more. To find out who pays and how much, keep reading: Increased Medicare payroll tax Currently, the Medicare payroll tax is 2.9% and it applies to earned income only. An employee is responsible for 1.45% of the tax and it’s deducted automatically from the paycheck. The employer kicks in the other 1.45%. Under the new tax provision, most taxpayers will continue to pay the 1.45% Me...