Change! You Better Believe It!

CHANGE? YOU BETTER BELIEVE IT

On January 1, 2011, here’s what happens... (read it to the end, so you see all three waves)...

First Wave:

Expiration of 2001 and 2003 Tax Relief

In 2001 and 2003, the GOP Congress enacted several tax cuts for investors, small business owners, and families.

These will all expire on January 1, 2011.

Personal income tax rates will rise.

The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed).

The lowest rate will rise from 10 to 15 percent.

All the rates in between will also rise.

Itemized deductions and personal exemptions will 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 married couples) will return from the first dollar of income.

The child tax credit will be cut in half from $1000 to $500 per child.

The standard deduction will no longer be doubled for married couples relative to the single level.

The dependent care and adoption tax credits will 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 retirement account, 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 in 2011.

The dividends tax will rise from 15 percent this year to 39.6 percent in 2011.

These rates will rise another 3.8 percent in 2013.

Second Wave:

Obamacare

There are over twenty new or higher taxes in Obamacare. Several will first go into effect on January 1, 2011. They include:

The "Medicine Cabinet Tax"
Thanks to Obamacare, Americans will no longer be able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (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). There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children.

There are thousands 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 children in 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 withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent.

Third Wave:

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 be held 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 to an explosion of AMT taxpaying families-rising from 4 million last year to 28.5 million. These families will have to calculate their tax burdens twice, and pay taxes at the higher level. The AMT was created 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.

This will be cut all the way down to $25,000. Larger businesses can currently expense 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 take place. The biggest is the loss of the "research andexperimentation tax credit," but there are many, many others. Combining high marginal tax rates with the 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 credits for education will be limited.

Teachers will no longer be able to deduct classroom expenses.

Coverdell Education Savings Accounts will be cut.

Employer-provided educational assistance is curtailed.

The student loan interest deduction will be disallowed for hundreds of thousands of families.

Charitable Contributions from IRAs no longer allowed.

Under current law, a retired person with an IRA can contribute up to $100,000 per year directly to a charity from their IRA.

This contribution also counts toward an annual "required minimum distribution." This ability will no longer be there.

PDF Version Read more: < www.atr.org/six-months-untilbr-largest-tax-hikes-a5171# >; http://www.atr.org/six-months-untilbr-l ... z0sY8waPq1

Now, your insurance will be INCOME on your W2's!

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 what ever 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.

Your have some Wrong information,on this part below friend.
"Starting in 2011, (next year folks), your W-2 tax form sent by your employer will be increased to show the value of what ever 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"

that amount will not be taxed. Current law excludes health insurance from taxable income, and there's nothing in the health care law that changes that.

What stinks is the rise in income taxes, and the reduction of the child credit and standard deduction! Ick!!

Oh, the horror... The rates return to what they were during Ronald Reagan's administration!!

The horror, the horror... :VeryScared: :VeryScared:

The GOP’s Intellectual Dishonesty Regarding Bush Tax Cuts
Republicans say that tax cuts for the wealthy must be extended to protect the economy and small businesses, even though neither would be affected by their lapse.

Over at Ezra Klein’s blog, Dylan Matthews recently polled an ideologically diverse group of economists on what tax rate they think would begin to reduce, rather than increase, tax revenue. The answers generally ranged from around 60 to 80 percent. There was a broad consensus that it does not kick in at the level of taxes we would revert to, which top out at less than 40 percent. (Matthews also asked some members of the Republican congressional leadership, but none responded.)

This punctures a hole in the Republican claim that it is OK to cut taxes without offsetting spending cuts because the increased economic growth will in turn increase tax revenue. To be fair, conservatives worry not only that high tax rates will decrease government revenue, but also that it will slow economic growth. As several conservative economists pointed out to Matthews, the tax rate that maximizes government revenue may be higher than the rate that maximizes economic growth. Thus, if you raise taxes too high, you may increase revenue now but decrease it over the long term.

The argument that because of this principle the two highest marginal rates should not be allowed to revert from 33 percent to 35 percent, and from 36 to 39.6 percent, respectively, has little relation to macroeconomic reality. The economy performed better under those slightly higher Clinton-era rates than during the Bush era.

Even in the abstract, the claim that increasing by a few percentage points a few rich citizens’ tax rate will harm economic growth is implausible. Outside of yacht manufacturers, Bentley dealers, and real-estate agents on Martha’s Vineyard, not many workers depend on the slight variations in disposable income of the very wealthy for their livelihood.

But wait, what if owners of small businesses reported their income as individuals? Then wouldn’t raising their taxes decrease their desire to expand their business at this precarious juncture in our economic recovery? Perhaps, and that is precisely the argument Republicans have glommed onto. But as The New York Times reports, “Analyses from the Joint Committee on Taxation and the Tax Policy Center, a nonpartisan research organization, show that less than 3 percent of filers with small-business income pay at the top two income tax rates, and many of those are doctors and lawyers in partnerships.” So, when presented with this objective fact that the factual basis for their arguments are hogwash, presumably Republicans will retract their demand for extending the Bush tax cuts on top earners, right?

Don’t count on it. But doctors and lawyers do buy cars and houses. So if Republicans get their way, maybe at least some Bentley dealers and real-estate agents will be happy.

The GOP’s Intellectual Dishonesty Regarding Bush Tax Cuts

Excuse me while I wait for the next wave of nausea to pass from reading the same copy-and-pasted RedState.com/NewsMax/conservative-blog regurgitated bullsh** from the right-wing.

Hard to say:

Can you give me the source for your disagreement with a few lines out of all that I posted, besides your word only, as a reference? Thank you. As you can see this was from Kiplingers.

LJ:

Where in all of what I posted was there reference to the Bush Tax Cuts?

Why don't you start your own threads with these rants? Oh, because they won't be read by anyone?

Nmysys wrote: CHANGE? YOU BETTER BELIEVE IT

On January 1, 2011, here’s what happens... (read it to the end, so you see all three waves)...

First Wave:

Expiration of 2001 and 2003 Tax Relief

In 2001 and 2003, the GOP Congress enacted several tax cuts for investors, small business owners, and families.

These will all expire on January 1, 2011.

Personal income tax rates will rise.

The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed).

The lowest rate will rise from 10 to 15 percent.

All the rates in between will also rise.

Itemized deductions and personal exemptions will 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%

Gee, since the whole first post was a list of all the BUSH TAX CUTS that are going to "expire"--(we don't know that they will yet, because Congress has not weighed in on the matter yet)--and you spent several lines listing which rates will go up, and by how much, it sort of seemed relevant...

I guess others are right...It's all about comprehension.

Factcheck.org-Home / Ask FactCheck / Health Care Law and W-2 Forms
Health Care Law and W-2 Forms
May 26, 2010
Q: Does the new health care law require workers to pay income tax on the value of employer-provided health insurance?

A: No. The value will appear on employees’ W-2 forms for information purposes, but will not be considered taxable income.

still, lots of changes coming

Okay, I like the sound of that a little better.