Health-care law prescribes new taxes, limits

Health-care law prescribes new taxes, limits

Investors have many questions about health-care reform and taxes top the list. Chris Hennessey explains the new taxes and fees created by the Affordable Care Act (ACA) that will generate more revenue for the federal government. Here are some highlights. 1. Medicare surtax on investment income. A 3.8% surtax on investment income became effective this

Washington debate raises appeal of Roth IRAs

Washington debate raises appeal of Roth IRAs

With the continuing budget debate on Capitol Hill, the future for tax rates may appear uncertain. A Roth IRA conversion can be a strategic move for clients to hedge against tax rate increases, and shore up tax diversification strategies in retirement. Hear more about these and other strategies for Roth conversions. 284679

Don’t let the Medicare payroll tax surprise your clients

Don’t let the Medicare payroll tax surprise your clients

Before tax season begins, high-income clients may be seeking clarity on the new taxes introduced this year as part of the federal health-care reform law. Some clients may be subject to the new 3.8% surtax on net investment income as well as an additional 0.9% Medicare payroll tax. These taxes apply to individuals with income

Health-care taxes take effect

Health-care taxes take effect

New taxes took effect this year as a result of the 2010 health-care reform legislation that may have an impact on tax-planning strategies. As of January, the Medicare payroll tax increased to 2.35% from 1.45%. In addition, a 3.8% surtax on “net investment income” was also introduced to help fund health-care reform. Both taxes affect

New law expands Roth conversions

New law expands Roth conversions

The new federal tax law expands the use of Roth IRAs in retirement plans, opening the door for tax diversification. Roth savings accounts were introduced to 401(k) plans by the Economic Growth and Tax Relief Reconciliation Act of 2001. This law allowed for the designation of a Roth 401(k) plan beginning in 2006. These plans

Congress faced with dueling budget proposals

Congress faced with dueling budget proposals

While the House this week approved a budget plan for FY 2014, the Senate continues to debate a starkly different proposal. As the budget process progresses, neither plan is likely to garner bipartisan approval, but the proposals illustrate the differences between the two political parties. Not surprisingly, long-term deficit reduction is a priority in both

Don’t get tripped up by the new tax thresholds

Don’t get tripped up by the new tax thresholds

While the new federal tax law brought good news for most taxpayers, there may be confusion for others trying to determine when certain tax provisions apply. The tax reform items are linked to income thresholds with different definitions of “income.” It is important for clients to understand the impact of the legislation on their 2013