After reading what is in store for us [BELOW], I wonder how many will admit that they voted for Democrats in the House, the Senate, and the Presidency !
Everyone makes mistakes. Without looking back, we need to correct the errors of the past and restore what is being taken away from us by a government that no longer responds to their constituents.
There's a lot of info. here, be sure to read it all to see how many ways this will touch you in the new year. It's kinda long. A CPA we know spends her summers boning up on the upcoming tax season. She says that this will be the biggest change we'll see in our lifetime. ~~~~~~~~~~~~~~~~~~~~
In just three months, on January 1, 2011, some of the largest tax hikes in the history of America will take effect.
They will hit families and small businesses in three great waves.
OnJanuary 1, 2011, here's what happens... (read it to the end, so you see all three waves)...
Expiration of 2001 and 2003 Tax Relief
In 2001 and 2003, the GOP Congress enacted several tax cuts forinvestors, small business owners, and families.
These will all expire on January 1, 2011.
Personal income tax rates will rise.
The topincome tax rate will rise from 35 to 39.6 percent (this is also the rateat which two-thirds of small business profits are taxed).
Thelowest rate will rise from 10 to 15 percent.
All the rates inbetween will also rise.
Itemized deductions and personal exemptionswill again phase out, which has the same mathematical effect as higher marginal tax rates.
The full list of marginal rate hikes is below:
The 10% bracket rises to an expanded 15%
The 25% bracket rises to 28%
The 28% bracket rises to 31%
The 33% bracket rises to 36%
The 35% bracket rises to 39.6%
Higher taxes on marriage and family.
The"marriage penalty" (narrower tax brackets for marriedcouples) will return from the first dollar of income.
The child taxcredit will be cut in half from $1000 to $500 per child.
Thestandard deduction will no longer be doubled for married couples relativeto the single level.
The dependent care and adoption tax creditswill be cut.
The return of the Death Tax.
This year only, there is no death tax. (It's a quirk!) For those dying on or after January 1, 2011, there is a 55 percent top death tax rate on estates over $1 million. A person leaving behind two homes, a business, a retirementaccount, could easily pass along a death tax bill to their loved ones. Think of the farmers who don't make much money, but their land, which they purchased years ago with after-tax dollars, is now worth a lot of money. Their children will have to sell the farm, which may be their livelihood, just to pay the estate tax if they don't have the cash sitting around to pay the tax. Think about your own family's assets. Maybe your family owns real estate, or a business that doesn't make much money, but the building and equipment are worth $1 million. Upon their death, you can inherit the $1 million business tax free, but if they own a home, stock, cash worth $500K on top of the $1 million business, then you will owe the government $275,000 cash! That's 55% of the value of the assets over $1 million! Do you have that kind of cash sitting around waiting to pay the estate tax?
Higher tax rates on savers and investors.
The capital gains tax will rise from 15 percent this year to 20 percent in2011.
The dividends tax will rise from 15 percent this year to 39.6percent in 2011.
These rates will rise another 3.8 percent in 2013.
Obamacare There are over twenty new or higher taxes in Obamacare. Several will first go into effect onJanuary 1, 2011. They include:
The "Medicine Cabinet Tax"
Thanks to Obamacare, Americans will no longer be able to use healthsavings account (HSA), flexible spending account (FSA), or healthreimbursement (HRA) pre-tax dollars to purchase non-prescription,over-the-counter medicines (except insulin).
The "Special Needs Kids Tax"
This provision of Obamacare imposes a cap on flexible spending accounts (FSAs)of $2500 (Currently, there is no federal government limit). Thereis one group of FSA owners for whom this new cap will be particularlycruel and onerous: parents of special needs children.
There arethousands of families with special needs children in the United States ,and many of them use FSAs to pay for special needs education.
Tuition rates at one leading school that teaches special needs childrenin Washington , D.C. ( National Child Research Center ) can easily exceed $14,000 per year.
Under tax rules, FSA dollars can not be used to pay for this type of special needs education.
The HSA (Health Savings Account) Withdrawal Tax Hike.
This provision of Obamacare increases the additional tax on non-medical early withdrawalsfrom an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent.
The Alternative Minimum Tax (AMT) and Employer Tax Hikes
When Americans prepare to file their tax returns in January of 2011,they'll be in for a nasty surprise-the AMT won't beheld harmless, and many tax relief provisions will have expired.
The major items include:
The AMT will ensnare over 28 million families, up from 4 million last year.
According to the left-leaning Tax Policy Center , Congress' failure to index the AMT will lead toan explosion of AMT taxpaying families-rising from 4 million lastyear to 28.5 million. These families will have to calculate theirtax burdens twice, and pay taxes at the higher level. The AMT wascreated in 1969 to ensnare a handful of taxpayers.
Small business expensing will be slashed and 50% expensing will disappear.
Small businesses can normally expense (rather than slowly-deduct, or"depreciate") equipment purchases up to $250,000.
Thiswill be cut all the way down to $25,000. Larger businesses can currentlyexpense half of their purchases of equipment.
In January of 2011,all of it will have to be "depreciated."
Taxes will be raised on all types of businesses.
There are literally scores of tax hikes on business that will takeplace. The biggest is the loss of the "research andexperimentation tax credit," but thereare many, many others. Combining high marginal tax rates withthe loss of this tax relief will cost jobs.
Tax Benefits for Education and Teaching Reduced.
The deduction for tuition and fees will not be available.
Tax creditsfor education will be limited.
Teachers will no longer be able todeduct classroom expenses.
One of the surprises we'll find come next year, is what follows - - a little "surprise" that 99% of us had no idea was included in the "new and improved" healthcare legislation . . . the dupes, er, dopes, who backed this administration will be astonished!
Starting in 2011, (next year folks), your W-2 tax form sent by your employer will be increased to show the value of whatever health insurance you are given by the company. It does not matter if that's a private concern or governmental body of some sort.
If you're retired? So what... your gross will go up by the amount of insurance you get.
You will be required to pay taxes on a large sum of money that you have never seen. Take your tax form you just finished and see what $15,000 or $20,000 additional gross does to your tax debt. That's what you'll pay next year.
For many, it also puts you into a new higher bracket so it's even worse.
This is how the government is going to buy insurance for the15% that don't have insurance and it's only part of the tax increases.
Not believing this??? Here is a research of the summaries.....
On page 25 of 29: TITLE IX REVENUE PROVISIONS- SUBTITLE A: REVENUE OFFSET PROVISIONS-(sec. 9001, as modified by sec. 10901) Sec.9002 "requires employers to include in the W-2 form of each employee the aggregate cost of applicable employer sponsored group health coverage that is excludable from the employees gross income."
- Joan Pryde is the senior tax editor for the Kiplinger letters. - Go to Kiplingers and read about 13 tax changes that could affect you. Number 3 is what is above.
"Welcome Home"-- Combat VETERANS! ..from 'The Man in the Door.' According to the Bible-- only God can remedy the many problems and woes of the world. True Christians are admonished to put their faith and TRUST in the Lord, and NOT lean upon their own [human] understanding. -Proverbs 3:5.
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