3.8 Percent Tax on Investment Income is a Certainty for 2013

Finance expert Mike Periu on a way to save on your investment income before rising taxes take effect next year.
President, Proximo, LLC
November 29, 2012 Even though reports of a framework for a fiscal cliff deal are starting to emerge, we know one tax that will go into effect next year regardless of what happens with that negotiation: The Patient Protection and Affordable Care Act (also known as Obamacare) provision will tax "unearned net investment income". This will include capital gains and dividend income from stocks, bonds, mutual funds, annuities, real estate and making loans. The 3.8 percent tax targets people who have an Adjusted Gross Income in 2013 of more than $250,000 (married) or $200,000 (single).  If you were planning on selling some assets in 2013, you should consider selling them in 2012.  If you have stocks that have greatly appreciated in value but that you want to hold for the long-term, you can consider selling them now and repurchasing them early next year to lock in the lower tax rate now. Before making any decisions though, you should consult with your financial advisor. 

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