Taxes for the “Affluent” in 2013:
- Top tax rate on ordinary income rises from 35% to almost 44%, an increase of almost 25%
- The top tax rate on capital gains rises from 15% to almost 24%, an increase of almost 60%
- Top dividend tax rate increases from 15% to almost 44%, an increase of almost 300%
- investment income (interest, dividends, capital gains, etc.) for families with AGI > $250K
- Estate tax exemption- $5M to $1M and rate rises from 35% to 55%, an increase of over 55%
- Estate gift tax exclusion- $5M to $1M
Proposition 30, a Sales and Income Tax Increase Initiative (If this proposition is passed in November, 2012, the income tax will apply retroactively to all income earned or received since the first of the year, January 2012):
- Raises California’s sales tax to 7.5% from 7.25%, a 3.45% percentage increase over current law.
- Creates four high-income tax brackets for taxpayers with taxable incomes exceeding $250,000, $300,000, $500,000 and $1,000,000. This increased tax will be in effect for 7 years.
- Imposes a 10.3% tax rate on taxable income over $250,000 but less than $300,000–a percentage increase of 10.6% over current policy of 9.3%. The 10.3% income tax rate is currently only paid by taxpayers with over $1,000,000 in taxable income.
- Imposes an 11.3% tax rate on taxable income over $300,000 but less than $500,000–a percentage increase of 21.5% over current policy of 9.3%.
- Imposes a 12.3% tax rate on taxable income over $500,000 up to $1,000,000–a percentage increase of 32.26% over current policy of 9.3%.
- Imposes a 13.3% tax rate on taxable income over $1,000,000–a percentage increase of 29.13% over current “millionaires tax” policy of 10.3%.
HAVE YOUR ATTENTION NOW!?!?!? – There are steps you need to take to prepare for these massive changes before the end of this year, and you know we can help. Contact us!!