Amanda Cenzer, Guest Author
By now you’ve probably heard of the “fiscal cliff,” a term coined by Federal Reserve Chairman Ben Bernanke that describes what could happen if no action is taken by Congress against the expiration of tax rates and spending reductions. Some of the highlights of what tax effects we could see include:
ORBA’s Wealth Management Group Newsletter is a quarterly publication focused on effective wealth management. The Winter 2015 issue includes two articles, Discussing Finances with Your Spouse and Exemption Portability vs. A Credit Shelter Trust.
Those who have income from investments may have to pay a new tax imposed by the 2010 health care act: the 3.8% net investment income tax (NIIT, also known as the Medicare contribution tax). The NIIT took effect on Jan. 1, 2013, and is in addition to — and calculated separately from — one’s regular income tax or alternative minimum tax liability. This article discusses who is subject to the tax, what income is and is not excluded from the NIIT, how the tax is calculated, and what strategies can minimize or avoid NIIT liability.