President Obama has proposed to raise taxes in the 2013 budget plan which is aimed to generate $1.4 Trillion in revenue from Americas’ highest earners. Included in the tax hikes are the 1) top individual income tax, 2) capital gains tax, 3) the Buffet Rule, and 4) unearned income tax.
1. The current Top Individual Income Tax rate is 35%. This is proposed to increase to 39.6%.
2. Capital Gains Tax is a tax that must be paid on profit realized resulting from the sale of non-inventory assets such as; stocks, bonds, precious metals, or real estate. The current Capital Gains Tax for the top rate is 15%. This is proposed to increase to 20%. It doesn’t stop here, see #4.
3. The Buffet Rule is a new law proposed in the 2013 budget plan which was created by Warren Buffet that is designed to impose a minimum tax of 30% to those earning an annual income of at least $1Million.
4. The Unearned Income Tax is proposed to increase to 3.8% charged to couples earning at least an annual income of $250,000 and to individuals earning at least an annual income of $200,000. The unearned income tax is also known as the medicare surtax. This will ultimately set the Capital gains tax for the top rate to 23.8%.
According to Gene Sperling, the White House director of the National Economic Council, the reason for the 2013 proposed tax hikes is that “we simply can’t afford to devote $206 Billion for lower tax rates for the highest income Americans.”
Alex S. Isak
Director of Sales | Upper West Side
Goldenwood Property Advisors, Inc.