Doctor's Life Magazine, Tampa Bay Doctor's Life Tampa Bay Vol. 2 Issue 1, 2014 | Page 11
What exactly are a few of the changes that will effect higherincome professionals especially physicians? To start expect a higher
income tax rate, higher capital gains rate, net investment income tax, a
new Medicare surcharge on earned income and a reduced benefit from
personal exemptions and itemized deductions.
HIGHER TOP INCOME TAX RATE
Income levels above $400,000 ($450,000 for married taxpayers
filing jointly, $425,000 for head of households) are now being taxed
at a 39.6% rate as of January 1, 2013. Those amounts are adjusted
for inflation after 2013. Taxpayers with $150,000 of income above
the threshold amounts will pay an
additional $6,900 in tax in 2013
because of the additional tax rate
of 4.6%. The threshold levels for
2014 are $432,200, $457,600, and
$406,750
Act of 2010, higher-income taxpayers have been required to pay
an additional 3.8 percent on net investment income as well as a 0.9
percent Additional Medicare Tax on earned income.
In both cases the income threshold levels for being subject to these
new taxes are considerably lower than the 39.6 percent bracket and 20
percent capital gain rates.
The threshold amount is $200,000 in the case of a single
individual, head of household (with qualifying person) and qualifying
widow(er) with dependent child. The threshold amount is $250,000 in
the case of a married couple filing jointly and $125,000 in the case of
a married couple filing separately. For the 3.8 percent net investment
CAPITAL GAINS AND
DIVIDENDS
The American Taxpayer Relief
Act also raised the top rate for longterm capital gains and dividends to
20 percent, up from the Bush-era
maximum 15 percent rate—again,
applicable to all net long-term
capital gains from transactions made
on or after January 1, 2013. That
top rate will apply to the extent
that a taxpayer’s income exceeds
the thresholds set for the 39.6
percent rate ($400,000 for single
filers; $450,000 for joint filers and
$425,000 for heads of households).
MEDICARE TAXES
Set into motion on January
1, 2013 by the Affordable Care
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