THE United States Treasury Department has proposed two more
regulations on taxes: the Net Investment Income Tax and the Additional Medicare
Tax that will be imposed by 2013 as a result of President Barack Obama's
Affordable Care Act of 2010. As per the proposal, 3.8% Net Investment Tax will
be imposed against individuals, estates and trusts on their investment income,
and the 0.9% Additional Medicare Tax to be levied on an individual's wages and
self employment income, that exceed threshold amounts from January 1, 2013.
The
threshold amount for individuals is USD 250,000 for married taxpayers filing
jointly, USD 125,000 for married taxpayers filing separately, and USD 200,000
for single taxpayers, and will not be indexed for inflation. The tax will not
affect income tax returns for the 2012 taxable year that will be filed in 2013,
and will not be payable by non-resident.
Broadly investment income includes, but is not limited to, interest,
dividends, net capital gains, rental and royalty income, non-qualified
annuities, and income from businesses involved in the trading of financial
instruments or commodities, reduced by certain expenses allocable to that
income.
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