“Tax planning isn’t what it used to be. The full effect of the Patient Protection and Affordable Care Act of 2010, aka Obamacare, will be felt on 2013 tax returns.
“The new 3.8 percent Medicare surtax will in effect create 18.8 percent and 23.8 percent brackets for capital gains, in addition to the zero percent and 15 percent rates.
“Harvesting tax losses in the past has always been front and center as part of tax planning. With the new Medicare surtax, consideration should be given to taking gains in lower income years to reset your tax basis if you see yourself selling appreciated securities in the near future.
“The key for 2013 is to not just think of your 2013 income tax liability when you start tax planning, but look ahead a couple of years as well and create a plan to strategize taking both capital losses and capital gains.”
-Peter T. Jaworski