If You Fail to Plan…Plan to Pay Taxes!

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By Candace Spencer, CPA, MAFM and Certified QuickBooks ProAdvisor Have you ever been surprised with a large tax bill? When is the last time you received tax planning and/or projections and knew where you stood before year-end? Do you realize that those two questions are closely related? By getting solid financial information and acting on it in a timely fashion, you can prevent unpleasant surprises come filing season. With December right around the corner, time is running out. The good news is that it’s not too late; however, it’s now a race against the clock. If you need more motivation to start thinking about such annoyances as taxes this far before April 15, here are three reasons why you may want to consider tax planning. First, if you haven’t already heard, there have been major changes in the tax law for 2013. Therefore, you can expect the 2013 tax year will NOT be like last tax year. Here are just a few changes you need to be aware of: In 2012 100% of itemized deductions … [Read more...]

Affordable Care Act – Beware of the Medicare Surtax for High Income Individuals

Patient Protection and Affordable Care Act

By Stacey Gorowitz, CPA, MBA  Although the Patient Protection and Affordable Care Act was signed into law in 2010, many continued hoping the health care law would go away. We must now accept the tax implications it poses and plan accordingly.  In general, individuals with Adjusted Gross Income (AGI) greater than $200,000 should pay close attention. The two surtaxes, which will be imposed on higher-income taxpayers, effective for tax years beginning after December 31, 2012 include: 1) Medicare Surtax on Earned Income – In addition to the current 1.45% Medicare portion of payroll tax there will be a new 0.9% surtax applied to taxpayers who receive wages or self-employment income in excess of $200,000 for single and $250,000 for joint returns.  This surtax is not imposed until after a taxpayer crosses the earnings “threshold”. 2) Unearned Income Medicare Contribution – 3.8% Medicare tax is imposed on the lesser of net investment income or Modified AGI (specifically defined by … [Read more...]