Net Investment Income Tax. Beginning in 2013, you may be subject to Net Investment Income Tax (NIIT). The NIIT is 3.8% of the smaller of
(a) your net investment income or
(b) the excess of your modified adjusted gross income over:
$125,000 if married filing separately,
$250,000 if married filing jointly or qualifying widow(er), or
$200,000 if any other filing status.
See Form 8960 and its instructions.
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Change in tax rates. The highest tax rate is 39.6%. For more information, see the 2013 Tax Computation Worksheet or the 2013 Tax Rate Schedules near the end of this publication
Tax rate on net capital gain and qualified dividends. The maximum tax rate of 15% on net capital gain and qualified dividends has increased to 20% for some taxpayers. . You can deduct only the part of your medical and dental expenses that is more than 10% of your adjusted gross income (7.5% if either you or your spouse is age 65 or older).
Personal exemption amount increased for certain taxpayers. Your personal exemption is increased to $3,900. But the amount is reduced if your adjusted gross income is more than:
$150,000 if married filing separately,
$250,000 if single,
$275,000 if head of household, or
$300,000 if any other filing status
Limit on itemized deductions. You may not be able to deduct all of your itemized deductions if your adjusted gross income is more than:
$150,000 if married filing separately,
$250,000 if single,
$275,000 if head of household, or
$300,000 if any other filing status
Samesex marriages. If you have a same-sex spouse whom you legally married in a state (or foreign country) that recognizes same-sex marriage, you and your spouse generally must use the married filing jointly or married filing separately filing status on your 2013 return, even if you and your spouse now live in a state (or foreign country) that does not recognize same-sex marriage. S
If you meet certain requirements, you may be able to file amended returns to change your filing status for some earlier years. For details on filing amended returns,
Health flexible spending arrangements (FSAs). You cannot have more than $2,500 in salary reduction contributions made to a health FSA for plan years beginning after 2012
Expiring credits. The plug-in electric vehicle credit and the refundable part of the credit for prior year minimum tax have expired. You cannot claim either one on your 2013 return.
Ponzitype investment schemes. There are new rules for how to claim a theft loss deduction on Form 4684 due to a Ponzi-type investment scheme.
Home office deduction simplified method. If you can take a home office deduction, you may be able to use a simplified method to figure it. See Publication 587.
Standard mileage rates. The 2013 rate for business use of your car is increased to 56 1/2 cents a mile.
The 2013 rate for use of your car to get medical care is increased to 24 cents a mile.
The 2013 rate for use of your car to move is increased to 24 cents a mile.
Foreign source income. If you are a U.S. citizen with income from sources outside the United States (foreign income), you must report all such income on your tax return unless it is exempt by U.S. law. This is true whether you live inside or outside the United States and whether or not you receive a Form W-2 or Form 1099 from the foreign payer. This applies to earned income (such as wages and tips) as well as unearned income (such as interest, dividends, capital gains, pensions, rents and royalties). If you live outside the United States, you may be able to exclude part or all of your foreign source earned income.