Introduction
A new year also brings new changes in U.S. policies that can have an effect on your current financial situation. Proper planning is essential in minimizing taxes and maximizing returns. Outlined below are key Tax Law and Retirement Plan Changes effective for the year 2015.
Tax Laws in Effect
Since 2013, top income earners experienced a substantial increase in investment taxes which have greatly impacted their nominal returns.
Increases included the marginal income tax rate increase from 35% to 39.6% for earners with income over $400,000 (single) / $450,000 (joint), as well as a higher 20% tax rate on qualifying dividends and long-term capital gains. In addition, investors with adjusted gross income of at least $200,000 (single) / $250,000 (joint) also felt the tax effect with a new 3.8% tax on “unearned” net investment income above thresholds due to the Affordable Care Act (ACA). In all, high earners are paying 59%
Retirement Plan Contribution Limits