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A Financial Prospective on the Coming Election

A good reason to vote for Romney this year!

On January 1, 2013, there will be an explosion of new taxes and tax increases.I believe that a vote for Romney will be your best chance to reverse some of the below tax increases. For some families these taxes can be devastating.The effect on you may be worse than the example below.

Based on the best estimates here are some of the changes. Please, make yourself aware of the facts and not the political spin that is rampert in the news. If you do, I am sure you will make the right decision and cast your vote for Romney, McMahon and Roraback and help turn this economy around. 

Personal income tax rates:

the 10 % bracket rises to a new and expanded 15 %

25 %  to  28 %

28 %  to  31 %

33 %  to  36 %

35 %  to  39.6 %

  • Child tax credit cut in half from $ 1000 to $ 500 per child
  • Capital gains tax rises from 15 % to 23.8 %
  • Top dividends tax rises from 15 % to 43.4 %   (tax hike plus, Obamacare surtax)

Some of the 20 new or higher taxes embedded in Obamacare:

  • 10 % tax on tanning services,
  • Medical cabinet tax, the HSA withdrawal tax, Medical Devices taxes
  • Tax on profits from home sales ( see your financial advisor to determine if it applies to you)

 The Alternative Minimum Tax (AMT) will now cover approx. 31 million families at higher tax rates instead of the 4 million now. ( see your financial advisor for more details and if you will fall under this tax )

Many taxes raised on all types of businesses

Tax benefits for Education and Teaching reduced. 

Charitable contributions via transfers from IRAs no longer allowed.

This is the largest tax increase in American history.

Add in Gov. Malloy's tax increases (Ct's largest tax increase)

To help better understand the impact see the below sample family and some of the taxes for comparison vs. prior year











Sample with same Year to Year Income






     (Estimates only)















Names:   John & Jane Brown

 

 






Ages:      Both age 52


 






Children: Two,  ages 17 and 15

 

 
















2012

 

2013















Income









John

75,000


75,000






Jane

33,000


33,000






Dividends

1,800


1,800






Capital Gains

1,000


1,000















Total Income

110,800


110,800















Itemized Deductions

22,500


22,500






Exemptions

14,800


14,800















Net Income

73,500


73,500















Note: the new taxes above need to be paid out of the above Net Income in 2013 thus less income to spend !















Fed Inc Tax









Salary

9,805


9,840






Dividends

270


504






Cap Gain

150


200






Social Security Tax

4,620


6,820















Child Tax Credit

1,000


500















Total Federal Tax

13,845


16,864















About

20% Tax Increase !!!!







plus the new taxes !!!






Plus the possible exposure to the Alternative Minimum Tax (AMT)


Still not convinced ?  Watch this video from the founder of Home Depot

http://www.youtube.com/watch?v=-TKCwSVH7Bw&feature=player_embedded


The above sample is an estimate only and is not intended to be represent and particular situation. See your tax advisor for how it may apply to you.













( this example was developed by Jerry Friedrich, Irv Agard and Dr Robin Appleby and is only a simple example. Your own results may vary depending on your income, credits, exemptions, deductions etc. See your own financial expert for your personal circumstance)










This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

Steven DeVaux October 29, 2012 at 05:56 AM
I thought Malloy raised our taxes 20% last year? Oh, it's Obama's turn, I forgot. Retroactively.
Rob Gianazza October 29, 2012 at 02:20 PM
So much to redistribute, so little time remaining...
Ken October 29, 2012 at 05:39 PM
One error to note in your analysis. Soc. Sec. is not related to income taxes. Including So. Sec. in your example is a BIG error. Soc. Sec tax is not going up! It is merely returning to its statutory limit that was in effect prior to the temporary 2% reduction. Neither Dems or Reps. want to extend the temporary reduction. You could stretch this example to show a 50% increase in taxes for someone who has no income tax liability or a minimal increase in taxes for someone who's income exceeds the Soc. Sec. ceiling. Above that income level no Soc. Sec. is withheld. In any case, in this example if you take out the erroneous inclusion of Soc. Sec. the increase is about 6% due to changes in the other items in your example.
Steven DeVaux October 29, 2012 at 05:55 PM
Spendable income is going down, no matter how you cut it. Now it's merely degrees of how much you are going to lose in disposable income starting January 1st. You already lost with the Connecticut state tax increases, the local property tax increases...now it's the federal government's turn. Splitting hairs about terminology is not going to change the fact that payroll checks are going to shrink come January 1st.
Jerry Friedrich October 29, 2012 at 07:17 PM
Ken, you are correct.....good catch ! Thanks.
Steven DeVaux October 29, 2012 at 07:21 PM
Even the unemployed are looking at tax increases.

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