As a new tax year is upon us, there are new tax laws as well. Even though we are just starting out the year, the United States Government has already put into effect several changes for new tax laws.
Those who make more money can expect to pay more taxes. Those in the United States who are single and make over $400,000 and married couples who make over $450,000 will find that they are now in a higher income tax bracket.
In the past, those who were part of these income thresholds were subject to a 35% tax, however in 2013, those folks will now be subject to a 39.6% tax. Capital gains tax rates have also increased. This year, it has increase to 20% for all of those in the higher tax bracket.
Earned Income Tax Credit
The earned income tax credit has seen an increase from $5,891 to $6,044 for those couples who file jointly and who claim three or more qualifying dependents. This is a great tax break for those who are low to middle income households.
Other Changes
There are also new tax laws for Social Security and Medicare. The taxable Social Security wage ceiling has increased for this year to $113,700. For Medicare, it doesn’t matter your income since there is no wage ceiling. With that said, if you make over $200,000, there will be an additional tax assessed of 0.9%.
This year definitely brings some benefits to those who have low to middle incomes. It also taxes those who are in the higher tax bracket with higher taxes. It is very important to stay up to date on all the new tax laws.
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