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Current and Projected 2013 Federal Income, Estate, Gift and GST Top Tax Rates

October 2, 2012

Under Current law as of October 1, 2012

 

 

Type of Income

2012

2013

Earned income (1)

35.0%

39.6%

Traditional IRA withdrawals

35.0%

39.6%

Pension and qualified plan distributions

35.0%

39.6%

Tax exempt bond interest

0.0%

0.0%

Interest income

35.0%

43.4%

Qualified dividend income

15.0%

43.4%

Short term capital gains

35.0%

43.4%

Long term capital gains

15.0%

23.8%

Trade or business income(1)

35.0%

39.6%

S corporation distributions to active participants

35.0%

39.6%

S corporation distributions to inactive shareholders

35.0%

43.8%

Capital gains on property used in a business

15.0%

20.0%

(1) This income is subject to FICA, Medicare or self-employment   taxes
     
Gift, Estate and GST Taxes

2012

2013

Gift, estate and GST rates

35.0%

55.0%

Estate tax exemption phase out rate (2)

35.0%

60.0%

Gift tax exemption

$5,120,000

$1,000,000

Estate tax exemption

$5,120,000

$1,000,000

GST tax exemption

$5,120,000

$1,430,000

Annual exclusion

$13,000

$14,000

(2) The phase out is for taxable estates over $10,000,000 so that   entire estate tax is 55%  

 

Prepared by Edward Mendlowitz, CPA, Partner WithumSmith+Brown based on information believed to be correct. Readers are cautioned that the 2013 rates are expected to change and they should check with their tax advisor before entering into any transaction.  This comparison has been prepared for informational purposes only.

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