SOME OF 2014 TAX FACTS

Income tax rate increased for high earners beginning in tax year 2013

- 39.6% rate applies to income above:
$450,000 married filing joint, qualifying widow; $425,000 head of household; $400,000 single; $225,000 married filing separate (indexed for inflation after tax year 2013)

Capital gain & dividend rate increase for high earners beginning in tax year 2013
Top rate is 20%

Applies to income above: $450,000 married filing joint, qualifying widow; $425,000 head of household;

$400,000 single; $225,000 married filing separate

Personal exemption phase-out (PEP) & itemized deduction limitation (Pease) for high earners

Thresholds: $300,000 married filing joint, qualifying widow;

$275,000 head of household; $250,000 single;

Additional Medicare Tax (AdMT) – Individuals

0.9% AdMT on wages, compensation and self-employment income received in excess of:

 $250,000 married filing joint; $125,000 married filing separate; $200,000 others

Employers collect the extra 0.9% on wages exceeding $200,000

Net Investment Income Tax (NIIT)

Medicare tax will apply to investment income Tax is 3.8% of the lesser of:

Net investment income (Gross income from interest, dividends, annuities, royalties, rents, and other passive income, not from ordinary trade or business)

 or

Excess of modified AGI over $250,000 married filing joint or qualifying widow; $125,000 married filing separate; $200,000 others

Retirement contribution limits

IRA: $5,500 ($6,500 if 50+)

401K: $17,500 (23,000 if 50+)