Understanding tax laws makes progress possible in the US. But keeping up with annual adjustments to our tax code can be a cumbersome task. Fortunately, single taxpayers in Carroll, Ohio, working couples in Columbiana, Ohio, and retirees in Jefferson, Ohio can count on Appalachian Basin CPAs, Inc. in Canton, Ohio to stay abreast of the specifics. The team of certified valuation analysts translates Congress’ maneuvers into useful information. Right now, they are making sense of increases to standard deductions, personal tax rates for people with high incomes, and lesser known changes. And their breakdown could likely benefit you.
What could be considered one of the few bright spots for 2013, standard deductions are rising a bit. Married couples filing jointly will get a $12,200 standard deduction. If one spouse is age 65 or older, the amount increases to $13,400. And it goes up to $14,600 if both are age 65 or older. Single taxpayers can claim a $6,100 standard deduction or $7,600 if they’re at least 65 years old. For heads of household, it’s $8,950 plus $1,500 more once they reach age 65. And blind people will receive $1,200 more across the board ($1,500 if unmarried and not a surviving spouse).
There is always a bit of give and take when dealing with the US government. As such, personal tax rates for people with high incomes are increasing for the first time since 1993. Effective this year, a 39.6% income tax rate applies to income over $400,000 for singles, $425,000 for heads of household, and $450,000 for married couples filing jointly.
High incomers will also resume losing some of their itemized deductions. Write-offs are slashed by 3% of the excess of adjusted gross incomes over $250,000 for single taxpayers, $275,000 for household heads, and $300,000 for married couples filing together. But the total reduction can’t exceed 80% of itemizations. Without a plan to accommodate the changes, high incomers in Carroll, Canton, Columbiana, Jefferson, and the rest of the US could see significant differences when filing for this year as opposed to last year.
Also impacting people with high incomes are two Medicare surtaxes. The first is a 0.9% Medicare surtax on earned income. The second is a 3.8% Medicare surtax on net investment income. The former was passed in 2010 and delayed to 2013. It applies to wages as well as to self-employment income for single taxpayers and heads of households whose total earnings exceed $200,000. The latter Medicare surtax is another aspect of healthcare reform. It applies to unearned income of single filers and heads of household with modified adjusted gross incomes of about $200,000. In addition, the Social Security wage base rises this year to $113,700.
The string of personal tax increases may prompt people with high incomes in and around Carroll, Ohio; Columbiana, Ohio; and Jefferson, Ohio to seek qualified tax advice. And all can get the input they need to soften the blows from the experts at Appalachian Basin CPAs, Inc. Experienced in helping everyone from single taxpayers to corporations tame taxation, they can assess your situation and help you identify beneficial options. It will take more than standard deductions to help high-incomers avert tax burdens. And Appalachian Basin CPAs, Inc. can help all fill in the blanks. Visit their website at http://www.abbacpas.com to learn more of their expertise or call them at 330.437.1182 and make an appointment to experience it for yourself.
Appalachian Basin CPAs, Inc.
213 Market Avenue North
Canton, Ohio 44702
330.437.1182
http://www.abbacpas.com