In a landmark decision, the U.S. Supreme Court generally upheld the constitutionality of the controversial 2010 health care law. In addition to preserving mandates for health insurance coverage, certain tax provisions will take effect as scheduled in 2013, barring any subsequent legislation. Here's a summary of the main tax changes for 2013. <\/p>\n
Two Medicare surtaxes could affect individual taxpayers: <\/p>\n
A 3.8 percent surtax on the lesser of annual net investment income or the amount by which modified adjusted gross income (MAGI) exceeds $200,000 ($250,000 for married couples). \"Net investment income\" includes interest, dividends, royalties, rents, gains from dispositions of property and income from passive activities, but not tax-free interest or distributions from qualified retirement plans and IRAs. <\/p>\n
A 0.9 percent surtax on earned income such as wages that exceeds $200,000 ($250,000 for married couples). <\/p>\n
Flexible spending accounts: Currently, there's a $5,000 limit on pretax contributions to a flexible spending account used for dependent care expenses, but there's no such limit on health care FSAs. The law caps health care FSA contributions at $2,500 starting in 2013. <\/p>\n
Medical deductions: For 2012, you may deduct unreimbursed medical expenses in excess of 7.5 percent of your adjusted gross income. The law raises this AGI floor in 2013 to 10 percent for taxpayers under age 65. <\/p>\n
Other tax-related provisions in the law were also upheld by the Supreme Court. For instance, an individual will generally have to obtain \"minimum essential health insurance coverage\" or pay a nondeductible penalty, beginning in 2014. Another provision, which took effect in 2010, allows a qualified small business to claim a tax credit for part or all of the cost of providing health insurance. <\/p>\n
Contact your accountant regarding your personal circumstances. <\/p>\n<\/p>\n
Excerpt from: <\/p>\n
Sunken: Health care law to trigger tax provisions in 2013<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" In a landmark decision, the U.S. Supreme Court generally upheld the constitutionality of the controversial 2010 health care law. In addition to preserving mandates for health insurance coverage, certain tax provisions will take effect as scheduled in 2013, barring any subsequent legislation. Continue reading