The largely anticipated “American Taxpayer Relief Act of 2012” was signed in to Law by President Obama on 2 January 2013.
Highlights of the bill are as follows:
Increase of the top rate from 35 percent to 39.6 percent for high income households. The rate increase applies to single taxpayers with income above $400,000 and married couples with income above $450,000.
Long term capital gains tax rate increase to 20 percent up from 15 percent for higher income households applying to singles above $400,000 and couples above $450,000. The top long term capital gains rate remains at 15% for lower income taxpayers.
Itemised deductions and personal exemptions will be phased out for couples with income over $300,000 and singles with income over $250,000.
Estate tax exemption of $5 million per person. Any value in excess of $5million will be taxed at 40%.
New legislation applies retrospectively to tax years beginning after 31 December 2012.
If you wish to discuss the above in further detail please contact the US Team on
020 8037 1100 or usenquiries@taxadvisorypartnership.com.