In our tax services in St. Cloud, FL we ask our clients, Do you earn above average incomes? Yes, you are so luck, but you know what? For once, you are in for some bad luck. Too bad. You might have known that the tax laws have changed this year, and according to what is on the news, people with low income levels may get an edge? But what about you guys you earn so much more? The government had to compensate the loss somehow and it is likely that you may have to pay higher taxes this year. We understand your worries, and so we have a really good suggestion for you. Hire a reputed tax services St Cloud FL and you will not be disappointed.
In the meanwhile, we will let you what the changes are and you can discuss them with our chosen tax services St Cloud FL and gain information about the way they can affect you taxes.
Greater Tax Rates
In the past year, you taxable amount was calculated using 35% as the rate. This year the new rate is 39.6%. In points, the difference may not be that much but in terms of taxable amounts, is actually very significant. For single filers, this rate is applicable to those people who earn more than $40,000. Income limits for married people are $450,000 if they file jointly and $225,000 if they file separately. If you are head of the household, you will be subjected to this rate if you earn more than $425,000.
Tax rates have been increased not only on the income levels, but also on capital gains. Previously, this rate was 15% and now it will be 20%. Assuming that your taxable income is $500,000 and your capital gains are worth $20,000, your taxes will increase by $2,000.
Medicare surtax is a feature of the Affordable Care Act that is meant for generating federal revenue. The money will then be used to provide subsidiaries to people whose income levels are not much. Medicare surtax is calculated at 3.8% of the net income including income from royalties, rents, dividend and so on. If your adjusted gross income is more than $250,000 and you are a married filer or greater than $200,000 and you are a single filer, you will have to pay this surtax.
Considering all the figures, the total rate on dividends is 23.8%.
Up till now everyone could itemize deductions such as medical expenses, mortgage interest, student loan, retirement contributions and charity gifts to bring their taxable income lower. This will no more be the case for single filers whose AGI is more than $250,000 and double filers whose AGI is greater than $300,000. The net effect is that deductions will decrease by 3%. Overall, this can accumulate to a removal of 80% deductions of those that were allowable last year.
Sacred to see the way the changes can affect you? Once again, hire reputed tax services St Cloud FL, and you will be glad you did.
If you need more information about our St. Cloud, FL accounting and tax services, please contact us at 407-344-1012. Freedomtax Accounting’s staff has been providing honest accounting services and tax services for 15 years. Our Orlando accounting and tax firm has its main offices in Kissimmee, FL. Our services are provided nationwide, but mainly in the Central Florida market to areas like Orlando, South Orlando, Kissimmee, St. Cloud, Poinciana, Clermont, Davenport, and Hunters Creek, FL. Our tax accountants and IRS enrolled agents (irs ea) specialize in corporate accounting and bookkeeping, tax services, tax preparation, back taxes help, tax debt relief, tax resolution, tax planning, itin numbers, incorporations, and non profit 501c3 tax exempt status applications.