December 11, 2012

The Internal Revenue Service released standard mileage rates for 2013.  For business use of an automobile the rate increases to 56.5 cents per mile.  For medical or moving expenses, the rate increases to 24 cents per mile.  For services to charitable organizations, the rate remains 14 cents per mile.   

 

Additional Medicare Tax

December 11, 2012

The IRS issued proposed regulations and FAQs on the 0.9% additional Medicare tax, imposed by IRC Sec. 3101(b)(2), that will begin in 2013.  Individuals are liabile for the tax to the extent wages, compensation, or self-employment income exceeds $250,000 for MFJ ($125,000 MFS / $200,000 Single).  Employers must withhold the additional tax from wages paid in excess of $200,000, without regard to the person's filing status.  The employer is not required to notify the employee of the increased withholding, nor is there an employer match of the amount withheld. 

 

3.8% Net Investment Income Tax

December 11, 2012

Proposed regulations (REG-130507-11) and FAQs were released for the 3.8% net investment income tax, imposed by IRC Sec. 1411, that is set to begin in 2013.  The tax applies to the lessor of (1) net investment income, or (2) the excess of modified adjusted gross income over $250,000 for MFJ ($125,000 MFS / $200,000 Single).