Obama Wins: Here's What That Could Mean For Your Taxes

OBAMA WINS! DEMOCRATS RETAIN SENATE MAJORITY, GOP CONTROLS HOUSE HOW WILL THIS AFFECT YOUR TAXES? LET'S START WITH TAX BRACKET MARRIED FILING JOINTLY SINGLE $0 - $17,400 $17.401 - $70,700 . $0- $8,700 $8,701 -$35,350 $35,351 - $85.650 10% BRACKET YOUR TAX RATES THIS YEAR (2012) 15% BRACKET 25% BRACKET 28% BRACKET 33% BRACKET 35% BRACKET $70,701 - $142,700- $142,701 - $217,450 $217.451 - $388,350 $85,651 - $178,650 $178,651, - $388,350 OVER $388,351 OVER $388,351 SO WHAT MIGHT YOU PAY IN 2013? NO ONE KNOWS FOR CERTAIN, BUT HERE'S WHAT WAS PROPOSED ON THE CAMPAIGN TRAIL 2013 TAX BRACKETS - SINGLES (PROPOSED BY PRES. OBAMA) BRACKET INCOME RANGE TAXES DUE CHANGE FROM 2012 $0 - $875 $875 - $4,888 10% $0- $8,750 NO CHANGE $8.751 - $35,500 NO CHANGE NO CHANGE 15% $4.888 - $17,513 $17,513 - $43,665 $43,665 - $48,318 $48.318 - $119.076 25% $35.501 - $86.000 $86,001 - $179,400 $179,401 - $193,500 $193,501 - $390,050- $390,051 AND UP 28% NO CHANGE 33% NO CHANGE S$5,127 2$5,127 36% FROM THE CAMPAIGN TRAIL 39.6% $119,076+ 2013 TAX BRACKETS - MARRIED FILING JOINTLY (PROPOSED) INCOME RANGE $0- $17,500 $17,501 - $71,000 $71,001 - $143,350 $143,351 - $218,450 $218.451 - $241,900 BRACKET TAXES DUE CHANGE FROM 2012 10% $0 - $1,750 NO CHANGE $1,750 - $9,775 $9,775 - $27,863 $27,860 - $48,891 $48,891 - $56,630 15% NO CHANGE 25% NO CHANGE FROM CONGRESS: NO CHANGE NO CHANGE 28% 33% DEMOCRATS SUPPORT OBAMA TAX PROPOSALS. REPUBLICANS OPPOSE; WANT TO SEE BUSH TAX CUTS EXTENDED TO ALL TAX BRACKETS S$A444 2$4,444 36% $241,901 - $390,050 %$456.630 - $109,964 39.6% $390,051 AND UP $109,964+ *ALL NUMBERS ROUNDED UP TO THE NEAREST DOLLAR GOP CONGRESS' PROPOSED 2013 TAX BRACKETS TAXES DUE $0 - $1,750 BRACKET INCOME RANGE SINGLE TAXES DUE $0 - $8,750 $8,751 - $35,500 $35,501 - $86,000 $86,001 - $179,400 $179,401 - $390,050 $390,051 AND UP CHANGE FROM 2012 INCOME RANGE MFJ CHANGE FROM 2012- NO CHANGE NO CHANGE $0 - $875 $875 - $4,888 $4,888 - $17,513 $17,513 - $43,665 NO CHANGE $43,665 - $113,180 NO CHANGE 10% NO CHANGE $0 - $17,500 $17,501 - $71,000 $71,001 - $143,350 15% NO CHANGE $1,750 - $9,775 $9,775 - $27,863 25% NO CHANGE NO CHANGE 28% $143,351 - $218,450 $27,860 - $48,891 NO CHANGE $218,451 - $390,050 $48,891 - $105,519 NO CHANGE $390,051 AND UP 33% 35% $113,180+ NO CHANGE $105,519+ NO CHANGE WE ASKED THE MAGIC 8 BALL WILL CONGRESS AGREE ON NEW TAX LEGISLATION? WILL THE PRESIDENT SIGN THE BILL INTO LAW? A: ASK AGAIN LATER, CLOSER TO DEC. 31, WHEN THE TAX CUTS ARE DUE TO EXPIRE FOR ALL AMERICANS HOW DOES THIS ELECTION AFFECT: SOCIAL SECURITY THE ALTERNATIVE MINIMUM TAX HEALTH CARE CAPITAL GAINS & DIVIDEND TAXES PRESIDENT OBAMA: WILL DO PRESIDENT OBAMA: NO CHANGE, "WHAT PRESIDENT REAGAN CURRENT LAW: SEPARATE TAX CURRENT LAW: CERTAIN QUALIFIED DIVIDENDS TAXED AT AND SPEAKER TIP O'NEIL DID." RATES OF 26% AND 28% THAT CONGRESSIONAL DEMOCRATS: PRESUMABLY HE MEANS THE DEAL THEY STRUCK IN 1983 WHERE THEY INCREASED APPLY TO CERTAIN TAXPAYERS WHO MAKE MORE THAN AN NO CHANGE. WILL CONTINUE TO CAPITAL GAINS RATES, WHICH ARE 0% FOR TAXPAYERS IN THE OPPOSE REPUBLICAN EFFORTS EXCLUDED THRESHOLD AMOUNT. TO ALTER CURRENT LEGISLATION. 10% AND 15% TAX BRACKETS AND 15% FOR TAXPAYERS, GENERAL INTEREST RETIREMENT AGE AND RAISED RALL OTHER PAYROLL TAXES. PRESIDENT OBAMA: PEG CONGRESSIONAL REPUBLICANS: AMT RATES TO INFLATION, OR CURRENTLY DRAFTING AND EARNINGS ARE TAXED AT CONGRESSIONAL DEMOCRATS: PURSUING LEGISLATION THAT WOULD CRIPPLE OR ELIMINATE WHICH WOULD REQUIRE PEOPLE CURRENT HEALTH CARE REPLACE THE AMT WITH THE ORDINARY TAX RATES. CARRIED INTEREST IS TAXED AT CAPITAL GAINS RATES. ARE UNITED AGAINST CUTS, WITH SO-CALLED "BUFFETT RULE," NO INTENTION OF INCREASING COSTS TO TAXPAYERS. MAKING MORE THAN $1 MILLION LEGISLATION. A YEAR TO PAY AT LEAST 30% OF INVESTMENT INCOME IN TAXES PRESIDENT OBAMA: INCREASE CONGRESSIONAL REPUBLICANS: RAISE THE AGE OF RETIREMENT AND LIMIT BENEFITS PAID TO EFFECT ON YOUR TAXES: UNKNOWN. CAPITAL GAINS TO 20% FOR THOSE IN THE TOP TWO BRACKETS, DIVIDENDS TAXED AS ORDINARY INCOME FOR CONGRESSIONAL DEMOCRATS: "HIGHER INCOME" WORKERS OF MAY REFUSE TO "PATCH" THE AMT, MEANING A HUGE (NONSPECIFIC) TAX INCREASE. UNSPECIFIED BRACKET. CORPORATE TAX RATE INDIVIDUALS WITH ADJUSTED GROSS INCOME OF $200,000 ($250,000 FOR MARRIED S FILING. EFFECT ON YOUR TAXES: OR, THEY MAY CONTINUE TO JOINTLY). CARRIED INTEREST TAXED AS UNKNOWN PASS SHORT-TERM LEGISLATION COUPLES F CURRENT LAW: THE CORPORATE TO KEEP THE AMT NEAR TAX RATE IS 35%. INTENDED LEVELS. ORDINARY INCOME. PRESIDENT OBAMA: LOWER THE CONGRESSIONAL DEMOCRATS: SAY THEY WILL SUPPORT THE CONGRESSIONAL REPUBLICANS: CURRENT RATE TO 28%, EXCEPT FOR MANUFACTURERS, WHICH WOULD FACE A 25% RATE. ESTATE TAXES WOULD LOVE TO REPEAL THE AMT. PRESIDENT'S TAX PROPOSALS, CURRENT LAW: ESTATES WORTH EFFECT ON YOUR TAXES: UNKNOWN. CONGRESSIONAL REPUBLICANS: UP TO $5.12 MILLION ARE NOT TAXED, WITH ESTATES WORTH MORE THAN THAT TAXED AT 35%. CONGRESSIONAL DEMOCRATS: ARE EXPECTED TO SUPPORT THE ELIMINATE TAXES ON INVESTMENT INCOME FOR PRESIDENT'S TAX PROPOSALS, TAXPAYERS WITH ADJUSTED GROSS INCOME OF LESS THAN $200,000. RETAIN 15% TAX ON INTEREST, DIVIDENDS AND PRESIDENT OBAMA: EXEMPT CONGRESSIONAL REPUBLICANS: ESTATES WORTH UP TO $3.5 WANT TO LOWER THE CURRENT RATE TO 25% ACROSS THE MILLION AND INCREASE ESTATE CAPITAL GAINS FOR ALL OTHER TAXPAYERS. TAX RATE TO 45%. BOARD. CONGRESSIONAL DEMOCRATS: EFFECT ON YOUR TAXES: EFFECT ON YOUR TAXES: UNKNOWN, SAY THEY WILL SUPPORT THE UNKNOWN, BUT EXPECT THIS TO PASS WITH BIPARTISAN SUPPORT. PRESIDENT'S TAX PROPOSALS, CONGRESSIONAL REPUBLICANS: WANT TO REPEAL THE ESTATE TAX ENTIRELY. EFFECT ON YOUR TAXES: UNKNOWN. WHAT IF CONGRESS DOES NOTHING? 2013 INCOME TAX BRACKETS CAPITAL GAINS & DIVIDEND TAXES TAX BRACKET MARRIED FILING JOINTLY SINGLE IN 2012, THE MAXIMUM RATE FOR EACH WAS 15% $0 - $58.200 $58,201 - $140,600 $140,601 - $214,250 $0- $34,850 $34,851 - $84,350 15% BRACKET (AND PEOFLE IN 10% & 15% TAX BRACKETS PAID NO TAKES ON CAPITAL GAINS OR DIVIDENDS) 28% BRACKET 31% BRACKET IN 2013, THE MAXIMUM RATE FOR CAPITAL GAINS JUMPS TO 20% $84,351 - $171,850 $171,851 - $382,650 OVER $382,651 (16% ON GAINS FROM ASSETS ACOUIRED AFTER 1231/2000 AND HELD FOR OVER 5 YEARS) ALSO, ALL TAX BRACKETS WOULD PAY. PEOPLE IN THE 10-15% TAX BRACKET WOULD PAY 8-10% $214,251 - $382,650 39.6% BRACKET OVER $382,651 36% BRACKET AND THE MAXIMUM RATE FOR DIVIDENDS JUMPS TO 39.6% THOSE IN THE 10% BRACKET WOULD PAY 15%; THOSE IN THE 15% BRACKET WOULD PAY 28% SOURCES: www.usatoday.com/story/money/business/2012/10/21/taxes-2013-163m-workers/1647251/ www.nytimes.com/2012/08/02/us/politics/house-votes-to-extend-bush-era-tax-cuts.html?_r=0 http://online.wsj.com/article/SB10001424052702303879604577410143118102490.html; http://money.cnn.com/2012/07/24/pt/taxes/bush-tax-cuts/index.htm www.taxpolicycenter.org/taxtopics/2013-Budget.cfm; Design by oBizMedia H&R BLOCK NEVER SETTLE FOR LESS" www.hrblock.com f www.facebook.com/hrblock For informational purposes only. This da ta is compiled from independent third-party sources and does not represent the formal advice or conclusions of H&R Block. H&R Block has not independently verified this data for accuracy. Consult your tax professional for advice on your individual tax situa tion.