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Tax Changes Coming for 2013 Tax Filers

Some changes are in store for those about to file their 2013 tax returns. The wealthy, as well as some married same-sex couples, will feel a dose of change as they prepare their returns. Even taxpayers looking to deduct some healthcare expenses will see some changes. Let’s look at all the changes for 2013 tax filers.

New Filings May Include Changes for 2013 Tax Filers

Everyone filing their 2013 tax return will be impacted by the IRS’s delayed start date for processing tax returns. Because of the two-week-long U.S. government shutdown in 2013, the IRS had to move back the processing start date from January 21 to January 31, 2014. That probably won’t have too much of an impact on people’s tax returns. But it could be an inconvenient delay for some who are looking to get their refund as soon as possible.

Keeping with the law, however, the IRS is keeping April 15 as the tax filing deadline.

Same Sex Couples

Same-sex married couples will see a few changes for their 2013 tax returns.

They’ll now have the option to file jointly as a married couple, or to file separately as a married couple. The marriage penalty is also likely to kick in for some of these couples and will be even harder if both of the spouses are working. This change is due to a Supreme Court ruling holding that the federal government had to recognize legally-wed same-sex couples for federal purposes, like income taxes.

Another change for same-sex married couples is that they now have the opportunity to amend previous tax returns as far back as 2010. While the income earned by some of these couples may subject them to the marriage penalty if they file jointly, others may learn that they are eligible for a refund. It all depends on each couple’s particular situation, best gauged by a tax professional.

High Salary Jobs

Higher income earners will see an uptick in their tax bill. While the 2001 Bush tax cuts were extended for all Americans, those earning more than $400,000 annually (and households earning more than $450,000 annually) are going to see their tax rates increased from 36 percent to 39.6 percent.

But that isn’t the only tax increase that will be hitting the nation’s wealthy. There’s also a 0.9 percent Medicare tax that will apply to earnings over $250,000 for married couples, and individual earnings over $200,000. The extra tax was part of the Affordable Care Act, passed and signed into law in 2010, and funds the expansion of Medicare health services. To add to that, the same group of taxpayers subjected to the 0.9 percent Medicare tax will also see a 3.8 percent tax on income earned from investments.

What these taxes mean for some taxpayers is that a sizable tax penalty could be coming their way when they file. If a married couple each individually earned less than $200,000 a year, the Medicare tax wouldn’t be taken out of their wages via a W-2. But if their combined household income exceeds $250,000, their April filing won’t be a fun one as the 0.9 percent tax will be applied.

Medical Expenses

Deducting medical expenses has always worked to sizably reduce a taxpayer’s taxable income, as health care expenses are never cheap. But 2013 filers will notice a few changes. For starters, health care costs have to exceed 10 percent of a taxpayer’s adjusted gross income. That level used to be 7.5 percent, but it was increased. That made it harder for some people to use this deduction. Senior citizens older than 65 are exempted from that change for another 3 years.

2013 Tax Filers, You’re Ready.

Each new year brings new resolutions, new starts, and new taxes.

Do any of these tax changes apply to you? Comment below or tweet us at @StopIRSDebt!

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