Upcoming Expired/Expiring Tax ProvisionsNovember 27, 2012
I thought you might find this quick listing of selected expired/expiring tax provisions useful. As you know,
Congress could pass legislation at any time extending
or revising any or all of these provisions.
* SOCIAL SECURITY TAXES. Employee’s share will increase
to 6.2% after 2012, up from 4.2%.
* INCOME TAX RATES. 2012 rates of 10%, 15%, 25%, 28%,
33%, and 35% will change to 15%, 28%, 31%, 36% and
39.6% for 2013.
* CAPITAL GAINS. Maximum long-term rate will increase
from 15% to 20% after 2012.
* DIVIDENDS. Top 15% rate will be eliminated; dividends
will be taxed as ordinary income with a top rate of
* CHILD TAX CREDIT. Current $1,000 credit per qualifying
child will be reduced to $500 after 2012.
* AMT. Exemption amounts for 2012 are $33,750 for
singles, $45,000 for couples, down from 2011 “patched”
amounts of $48,450 for singles and $74,450 for couples.
* ESTATE TAX. Top 2013 rate will increase to 55% (up
from 35%); exclusion amount will be reduced to
$1,000,000 (down from 2012 amount of $5,120,000).
* DEDUCTIONS & EXEMPTIONS. After 2012, higher-income
taxpayers will again lose a portion of itemized
deductions and personal exemptions.
* DEPRECIATION. Section 179 expensing limit will be
reduced to $25,000, with a total qualifying property
limit of $200,000, down from 2012 levels of $139,000
and $560,000 respectively. 50% bonus depreciation
* EDUCATION. Education savings account contribution
limit will be $500, down from 2012 limit of $2,000.
Expanded American Opportunity Credit will expire and
be replaced by prior Hope Credit.
* TAX EXTENDERS. Tax breaks that expired after 2011:
Teachers’ classroom expense deduction, state and local
sales tax deduction, tax-free charitable IRA
distributions for those70 ? and older, higher
education tuition deduction, business R&D credit,
15-year depreciation for leasehold improvements and
The uncertainty in the tax rules makes the approaching
tax filing season more challenging than usual. We will however
do our best to keep everyone up to date with hthe latest
Lastly, thank you for being a friend of ours. We certainly appreciate your support and I personally thank every one of you from the bottom of my heart.
Douglas Rodrigues, CPA
DE Rodrigues & Company.
Tags: expiring tax provisions, fiscal cliff
Written by: Doug Rodrigues