The Individual Investor’s Guide to Personal Tax Planning 2013
The American Taxpayer Relief Act of 2012 (ATRA), signed into law at the start of 2013, simplified planning for the current tax year.
Following the uncertainty that existed at the end of 2012, this clarity was a welcome change. The revisions covered most of the tax code as it applies to individuals. Since the comprehensive legislation was passed in early January 2013, there has been little additional change beyond extending to married same-sex couples the same treatment as common-law married couples under the tax code.
In this article
- Estimate Your Taxes on AAII.com
- What’s New?
- Tax Software, Books and Guides
- Useful Tax Numbers
- Investment Strategies: 2014 and Beyond
- Tax Planning Strategies
- Year-End Estate and Gift Tax Planning
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We cover the changes included in the ATRA as they apply to 2013 and 2014 in this guide. We also cover the tax changes included in the Affordable Care Act. A higher floor for deducting medical expenses went into effect this year for those under the age 65. High income earners face two new Medicare taxes.
Those who like to file early may have to wait an extra one to two weeks. The Internal Revenue Service (IRS) expects to delay the starting date for when returns will be processed because of the partial government shutdown. The deadline for filing a return or claiming an extension will remain April 15, however.
The outlook for 2014 is not completely certain. A 29-person House-Senate budget committee is attempting to find common ground on fiscal issues and propose a plan going forward. Whether their discussions will encompass changes to the tax code or if any agreement on fiscal matters will be found are unknown. We do know that several tax breaks, including the exclusion from gross income of qualified charitable contributions made from a traditional individual retirement account (IRA), will expire on December 31, 2013, unless legislation to maintain them is passed.
Several line item numbers, including the standard deduction and mileage deductions, had yet to be updated for 2014 by the Internal Revenue Service at press time. This delay is due to the partial federal government shutdown. We have used estimates for these tax figures from what we consider to be reliable sources. Our intention is to update the online version of this guide as new information is released.
Regardless of what changes Congress makes (or does not make) to the tax laws, one thing will be constant—you will still have to pay taxes. Furthermore, even a simplified tax code is still likely to be too complex; hence the need for tax guides. As has been the case in years past, our tax guide provides an overview of the tax rates and deductions likely to impact the majority of AAII members. Since there are many details, loopholes and pitfalls within the tax code, it is impossible for this guide to provide enough details to cover specific tax situations. If you have questions, consult a tax professional. It is your tax return, and the IRS will hold you responsible for any errors made on it.
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