Well, for those who did not know it, the tax rates for 2012 have been carried on for the past couple of years.
The passing of the Tax Relief Act of 2010 has signed in the law the proposed extension of the current tax rate schedule for the previous two years.
This means that the rates will be subject to revision in 2013 unless new legislation is passed to further extend the changes. For those who don’t quite grasp the rating system, it might be good to go over them right now.
This will help you understand the value of the Tax Relief Act. Here is a breakdown on the Federal Tax
Rates of 2012.
Some Perspective on the Federal Tax Tables 2012
Prior to the official passage of the Tax Relief Act, the schedule of rates would have shifted in 2011. This may be better illustrated in the following breakdown.
- Those with a tax rate of 10% would have seen it change to 15%.
- Those with a 25% rate would have see it shift to 28%
- Those in the 28% bracket would have had a new rate of 31%
- Those in the 33% rate bracket would had a rate of 36%
- Those with a 35% rate would have had a 39.6% rate
Now, the tax rate changed noted above will not tax effect until the beginning of 2013, barring any decisions to introduce further legislation to maintain the rates as is or make other arrangements. It might also be mentioned that any capital gain income may be taxed at different tax rates. In most case, the capital gains are figured separately from other taxes. Having these rates ahead of
time can help you plan for tax time early.
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