Tags: Obamacare | Tax | Hikes | Wealthy

Obamacare Tax Hikes Unhealthy for the Wealthy

By Dan Weil   |   Wednesday, 02 Jun 2010 08:10 AM

Wealthy people may feel in need of medical attention after they see what the new healthcare law does to their tax bill.

For the top 1 percent of taxpayers, those who earn $624,000 a year or more, federal tax bills will surge about $28,500 a year, according to the Urban-Brookings Tax Policy Center in Washington, Barron’s reports.

Healthcare reform will largely be financed by $250 billion in tax hikes for the wealthy.

The top 1 percent of earners will pay 85 percent of the law’s biggest tax items: two increases in Medicare taxes.

They will also face higher taxes for capital gains and dividends as well as for income earned by trusts they have created for beneficiaries.

"We're talking about a significant tax hike at a time when there are already a number of different tax increases under way," Steve Kunkel, director of taxes at CBIZ MHM tax advisory firm, told Barron’s.

To stave off the capital gains hit, you might want to consider selling off stocks for which you’re sitting on big paper profits before the new tax begins in 2013. Then you can buy the stock back at a higher cost basis.

J.D. Foster, senior fellow at the Heritage Foundation, says President Barack Obama has his tax priorities wrong.

“The massive tax increase the president is contemplating will hurt small business, capital and savings,” he told Moneynews. “That’s ludicrous when unemployment is near 10 percent.”

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Wealthy people may feel in need of medical attention after they see what the new healthcare law does to their tax bill. For the top 1 percent of taxpayers, those who earn $624,000 a year or more, federal tax bills will surge about $28,500 a year, according to the...
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