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What We Know About Fiscal Cliff Tax Planning

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  • Description

    FBN's Rich Edson on the possible dos and don’ts for the end of the year tax planning.

  • Duration 1:50
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Thank you very much.

As the fiscal clip lose at the end of the year promising a passel higher taxes.

Hi harder to get bonuses may be in -- squeezed rich -- and joins us from Washington.

Called bonus is if you're considering selling assets dividends.

Gridlocked -- -- because basically the tax code is such a mess -- understands what's going to happen on January 1 even here in Washington and that means a tax planners are taking.

In much different strategy.

It's -- a reverse strategy of what people usually contemplates that the usually contemplate.

Accelerating expenses and to the end of the current year and pushing off and -- deferring it into the next year.

So in all this uncertainty and all these tax increases automatically scheduled for the beginning of next year what -- do first off.

Get paid now especially bonus payments if you make two indicators individual.

You're hit with a nearly 40% top marginal rate in the health care law's point 9% surtax on top of that dividends now the top rate.

I'm qualified dividends is 15% that turns into ordinary -- -- at the top that's nearly 40%.

And then the president's health care a lot investment tax of three point 8% sell for a gain now if you can if he can take a capital gain.

Do it now the top rate goes from fifteen to 20% and then that obamacare surtax on top of that.

And defer deductions and expenses this is something that you typically.

Most situations you -- -- do upfront but if you get deferred and next year when tax rates are higher or supposed to be higher.

You can take a little bit off that tax bill if you do your investments next year and the -- Next year but again congress is still -- the details what we know about it sort of the broader themes of a framework that's emerging as for the specifics of next year.

Democrats Republicans -- so fighting now -- now.

Back to you by what advice thanks very much rich --

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