My good friend, Ed DeFrance, at Baird, just sent me an article Baird puts out about the new health care law and a new tax which will affect high income filers. It seems that if you have household income over $250,000, starting in 2013, a new Medicare Tax of 3.8% will apply to interest, dividends, capital gains, rents and royalty income. This is in addition to
the new .9% tax on earnings for these same families.
This is nearly a 5% increase in federal tax to those families who have a large gain due to some long-time planned event, such as selling the farm before retiring.
So if you want to avoid this increase in tax, consider selling those things which will result in large taxable gains now, and beat this huge tax increase!