Nobody likes paying more taxes, but as more people file their 2013 tax returns, many are seeing that their tax burden has gone up. What's behind the increases?
In the following video, Dan Caplinger, The Motley Fool's director of investment planning, talks about the multiple factors pushing taxes higher. Dan notes that the new 39.6% tax rate took effect for highest-income taxpayers, which also raised long-term capital gains and dividend tax rates from 15% to 20% on those taxpayers. But surtaxes on wage income and net investment income also added to tax burdens. Finally, Dan runs through provisions that reduced taxpayers' ability to take personal exemptions and itemized deductions, thereby raising taxable income and total tax due. Going forward, further hikes aren't built into the law, but new tax reform could change the landscape again.
Take advantage of this little-known tax "loophole"
Recent tax increases have affected nearly every American taxpayer. But with the right planning, you can take steps to take control of your taxes and potentially even lower your tax bill. In our brand-new special report "The IRS Is Daring You to Make This Investment Now!," you'll learn about the simple strategy to take advantage of a little-known IRS rule. Don't miss out on advice that could help you cut taxes for decades to come. Click here to learn more.