New Higher Income Tax Rate: If your taxable income is more than $400,000 ($450,000 if filing jointly, or $425,000 if head of household, or$225,000 if married filing separately), your new tax bracket is 39.6% up from 35%. If you are in the new higher income tax bracket, your new tax rate on capital gains and dividends is 20% – up from 15%.
Limitation on Itemized Deductions: If you have a high adjusted gross income, you may not be able to take all your itemized deductions, thanks to the Pease provision. Itemized deductions start to phase out at $154,950 if you are married filing separately ($258,250 for individuals, $284,050 if head of household, or $309,900 if filing jointly). Your itemized deductions are reduced by 3% of your adjusted gross income over these amounts, but they are never reduced by more than 80% of your otherwise allowable deductions.
Personal Exemption Phase out (PEP): Your personal exemptions for yourself, your spouse, and your dependents reduce your taxable income by $4,000 each. If your adjusted gross income is over $258,250 ($154,950 if married filing separately, $309,900 if filing jointly, or $284,050 if filing as head of household), your personal exemptions are reduced by 2% for each $2,500 or portion over these amounts. The exemption phases out completely at $380,750 ($432,400 if filing jointly, $216,200 if filing separately, $406,550 if filing as head of household).
The ACA also included changes for small businesses owners:
2015 Tax Returns: Business health insurance requirement: Starting in 2015, businesses with more than 50 FTE employees in 2014 (or a combination of full-time and part-time employees equivalent to 50 FTE employees) must either offer a minimum level of health care coverage to employees and their dependents, or pay Employer Shared Responsibility payments to the IRS for any FTEs who purchase coverage through a marketplace and receive the premium tax credit. The IRS will determine if any FTEs receive the premium tax credit and whether employers owe shared responsibility payments. Employers will be contacted by the IRS and have an opportunity to respond to the IRS before payment is assessed
Estate tax, Gift tax and General-skipping transfer (GST) tax’s exclusion amount: The federal estate tax will be imposed on estates that exceed $5,430,000 in 2014 and $5,450,000 in 2016. The federal gift tax will be integrated with the estate tax the exclusion amount for 2015 is $5,430,000 and 2016 is $5,450,000. For GST tax, the indexed exclusion amount for 2015 is $5,430,000. Beginning January 1, 2011, estate of decedents survived by a spouse may elect to pass any of the decedent’s unused exclusion to the surviving spouse. This election is made on a timely filed estate tax return for the decedent with a surviving spouse
Annual Gift exclusion: The annual exclusion from the gift tax for 2013-2016 is $14,000.