DGAA bLAWg

The Effect of the Affordable Care Act on Income Taxes

Web Admin - Tuesday, January 28, 2014

illinois obamacare tax lawyerThe Affordable Care Act (ACA or "ObamaCare") is a sweeping reform that touches many different areas of the law. One particular area that it impacts is the income tax structure. The law makes many small changes, such as increasing the threshold for deducting a medical expense to 10 percent of a person's adjusted gross income, or adding a new 0.9 percent tax to wages above $200,000. 

But, one particular change can have a large effect on income from real estate sales and trusts. The ACA adds a new 3.8 percent tax on a person's net investment income. But, this new tax only applies to certain people, and often, but not always, those in higher tax brackets.

The Effect on Real Estate Sales

The 3.8 percent tax applies to some sales of real estate, but not to all sales. First, the tax only applies to people making more than $200,000 a year or $250,000 for married couples filing jointly. Even for those people, not all sales qualify. This is because the first $250,000 of profit on the sale of the home does not count as income if the home is the person's primary residence.

And, that number goes up to $500,000 for married couples. A primary residence is a home that has acted as the sellers “main home” for two of the last five years. By way of example, suppose a married couple making over $250,000 a year sold their primary residence for a net profit of $650,000. They would only pay the 3.8 percent tax on the $150,000 in profits that exceed the $500,000 cap.

The Effect on Trusts

Even though the tax only applies to individuals making more than $200,000, it can also affect trusts with more than approximately $12,000 in net investment income, regardless of the beneficiary's income. This means that the tax can affect people earning less than $200,000 if they have an interest in such a trust. In this instance, the 3.8 percent tax applies to all net investment income in excess of the $12,000 cap. However, the law contains many exemptions and exceptions. For instance, certain types of trusts that do not qualify as trusts for purposes of income tax also fall outside of this law.

If you have questions about how the ACA affects your taxes or think you may be subject to the new net investment income tax, contact an Arlington Heights tax attorney today. Call 847-934-6000 to speak to a member of our team. We serve many Northwest Suburban areas including Rolling Meadows, Des Plaines, Crystal Lake, and other nearby communities.

About the Author: Attorney Jay Andrew is founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.



Recent Posts


Tags

product liability Des Plaines insurance attorney Des Plaines pet law attorney Des Plaines DUI attorney Illinois civil litigation lawyer civil litigation attorney Buffalo Grove injury lawyer criminal defense Fair Labor Standards Act DUI Des Plaines real estate attorney license Buffalo Grove traffic attorney severance agreements BAC traumatic brain injury Palatine employment law lawyer unauthorized overtime Buffalo Grove car accident lawyer Arlington Heights employment law attorneys wills Buffalo Grove probate lawyer Home Sale Contingencies Crystal Lake traffic attorney creditors Barrington injury attorney estate tax life insurance lawyer job lawyers Des Plaines motorcycle accident attorney expungement sexual harassment Rolling Meadows marijuana attorney Whistleblower Claims pay when paid contract appealing an insurance claim BUI cell phone accidents Inverness traffic law firm Rolling Meadows DUI lawyer Chicago attorney Rolling Meadows Illinois jet ski accident lawyer Des Plaines drug lawyer Schaumburg drug defense lawyer traffic crimes Palatine corporate law attorneys life insurance traffic violations defense wrongful termination guardianship attorney dynasty trusts overtime pay Arlington Heights accident attorney senior citizens swimming pools blended families employee rights Palatine civil attorney employee discrimination investment property Palatine traffic lawyer Illinois mortgages Illinois traffic accident lawyer Schaumburg personal injury lawyers Rolling Meadows traffic law firm estate planning Deer Park medical malpractice attorney wrongful termination, employment law, whistleblower protections, Illinois employment laws, discrimination in the workplace Long Grove estate planning attorney independent contractor personal injury lawyer Illinois Sales Representative Act Arlington Heights trucking lawyer real estate zoning estate planning trusts health insurance dispute Illinois motorcycle accident lawyer preventable medical errors DUI penalities denied insurance claim Crystal Lake pet attorney overtime violations employment law, Illinois employment laws Illinois business law atorneys digital assets, digital fiduciary, estate planning, digital content, Long Grove estate planning lawyers Illinois workers compensation lawyer Schaumburg employment law attorneys Deer Park traffic lawyer Illinois car accident attorney Arlington Heights personal injury attorney Schaumburg personal injury lawyer liability claims estate planning attorney food poisoning murder charges IRA benefits defective products living wills pizza emoji internet Palatine corporate attorney Illinois employment laws insurance claim delay Deer Park employment law attorney Illinois law elder abuse insurance claim denial Long Grove real estate lawyer Barrington criminal lawyer Rolling Meadows real estate attorney problem employees Illinois insurance claim dispute lawyers license reinstatement Schaumburg wrongful death attorney startup company Rolling Meadows insurance lawyer Crystal Lake employment law attorney Illinois insurance claim attorney first degree murder car collision employment law, meal breaks, rest breaks, hotel employees, Des Plaines employment law attorneys estate planning, digital assets, Revised Uniform Fiduciary Access to Digital Assets Act, Illinois digital assets, Illinois estate planning, Buffalo Grove medical malpractice lawyers uninsured motorist Long Grove estate planning small business drunk driving car accident lawyer Arlington Heights tax lawyer Federal Food Drug and Cosmetic Act Arlington Heights traffic attorney Inverness injury lawyer Illinois employment attorneys Deer Park personal injury lawyer Des Plaines injury law firm PTSD rumble strips Illinois medical malpractice case Illinois employment law firm rollover car crashes Crystal Lake employment lawyer controlled substance Palatine Attorney Des Plaines civil attorney DMV TBI real estate medical research car accidents Inverness insurance attorney workers compensation DUI defense employees subcontractor Arlington Heights lawyer living trust denied insurance claims insurance dispute, insurance dispute lawyers, insurance claim denial, insurance claim delays, Rolling Meadows insurance dispute attorneys Schaumburg construction accident lawyer life insurance claims Arlington Heights injury attorney FSLA low-ball insurance settlement Schaumburg car accident attorney Illinois trusts attorney personal injury accidents gift taxes boating accidents Des Plaines Traffic Lawyer Arlington Heights TBI attorney digital evidence Arlington Heights pedestrian accidents Palatine employment attorney dealing with problem employees drugs Illinois Transfer on Death Instrument real estate closing Rolling Meadows Attorney Barrington business law firm Attorney Ken Apicella criminal record Inverness DUI lawyer insurance attorney Illinois rollover accident lawyers products liability Barrington estate planning lawyer Illinois probate lawyer Barrington employment attorney Palatine business attorney revenge porn Self-Directed IRA Accounts GM ignition switches Rolling Meadows criminal attorney Schaumburg real estate lawyer Illinois insurance disputes Barrington attorney manufacturing blood alcohol content insurance agents Arlington Heights car crash attorneys Illinois construction accident attorney vacation home Rolling Meadows employment law attorney Crystal Lake medical malpractice lawyer new real estate form Illinois employment law attorney Super Mario liability pedestrian accident Buffalo Grove insurance claim dispute lawyers Schaumburg personal injury attorney breach of contract Deer Park workers compensation lawyer Rolling Meadows car accident lawyers Palatine construction attorney Schaumburg insurance lawyers bad faith insurance claims loopholes field sobriety test Rolling Meadows insurance dispute lawyers life insurance policy llinois Real Estate Lawyers Association Arlington Heights Traffic Lawyer Rolling Meadows accident lawyer Palatine real estate lawyer Rolling Meadows personal injury attorney distracted driving accidents Barrington litigation attorney Arlington Heights personal injury lawyer coronavirus bike accident Fourth of July forming a corporation in Illinois license suspension real estate lawyer living trust benefits filing a medical malpractice claim motorcycle accident Illinois workplace discrimination attorney traffic violations trust payments Chicago estate planning lawyer Illinois personal injury lawyers Arlington Heights real estate lawyer insurance claims Arlington Heights medical malpractice lawyer Illinois Wage Payment and Collection Act healthcare Schaumburg probate attorney Schaumburg estate planning lawyer medical malpractice Rolling Meadows insurance dispute lawyers, insurance dispute consent to a search workplace sexual harassment Des Plaines tax law firm jet ski Illinois insurance claim dispute lawyer operating agreements Illinois estate planning attorney insurance claim denials Illinois Trust Code Barrington personal injury attorney Illinois traffic attorneys fiduciary rule delay slip and fall Illinois collections attorney drug crimes Illinois wills and trusts reckless homicide Crystal Lake tax lawyer real estate leasing healthcare claims pet bites Illinois pet lawyer Illinois Detainer Actions Chicago will attorney, social media platforms, Illinois estate planning lawyer, pedestrian accidents Illinois traffic attorney Rolling Meadows employment attorney digital information Illinois attorney Schaumburg estate attorney Palatine law firm probate claims process Jay Andrew income distribution deducation Crystal Lake medical malpractice attorneys Crystal Lake pedestrian accident lawyer landlord underinsured motorist Kenilworth estate planning lawyer Crystal Lake civil litigation lawyer drug possession personal injury law firm vacation home fines Barrington workers compensation attorney Illinois job attorney drug crime privacy laws Long Grove real estate attorney rest breaks Illinois LLC creation Deer Park motorcycle accident lawyer Barrington drug crime attorney CAM criminal holiday statistics Schaumburg corporate attorney meal breaks Crystal Lake law firm Inverness personal injury attorney ken apicella Rolling Meadows estate planning attorney traumatic brain injuries insurance disputes, Illinois insurance disputes, Illinois insurance dispute attorneys, denied insurance claims, Arlington Heights insurance dispute attorneys insurance agent negligence Barrington employment law firm Illinois medical malpractice claim mass shooting Family Medical Leave Act digital assets deadly crashes Illinois traffic laws Buffalo Grove employment lawyer murder defense BAIID underfunded trust Rolling Meadows criminal lawyer Rolling Meadows drug defense attorney preventing accidents Barrington Traffic Lawyer Rolling Meadows business lawyer comp time spinal cord injury car accident lawyers Illinois speeding lawyer rollover accidents head on collisions Rolling Meadows personal injury lawyers trustee Illinois estate planning law firm Barrington personal injury lawyer Chicago estate planning no contest clauses civil litigation Deer Park DUI lawyer Illinois driving without license estate planning for college students Schaumburg traffic lawyer Crystal lake insurance dispute attorney Thanksgiving Crystal Lake criminal defense attorney Buffalo Grove law firm Barrington boating accident attorney right to work insurance claim dispute Palatine injury attorney Des Plaines personal injury lawyer insurance disputes Rolling Meadows boating crash lawyer hiring employees boating DUI trench injuries underage DUI Crystal Lake car accident lawyer Barrington Illinois estate planning lawyer Crystal Lake personal injury attorney mortgage agent POA owner responsibility in terrorem provision surgical mistakes personal injury claim irrevocable trust auto accidents construction contracts brain injury comparative negligence Deer Park real estate law firm real estate attorneys foreclosure Deer Park traffic accident attorney Chicago lawyer probate fees back injuries car accident marijuana crimes attorney driving Rolling Meadows corporate lawyer Schaumburg Arlington Heights wills and trusts lawyer Illinois small business Transfer on Death Instrument minimum wage Des Plaines personal injury lawyers FMLA insurance claim dispute attorney Rolling Meadows medical malpractice lawyers Palatine estate planning lawyer Illinois workers compensation attorney pain and suffering ObamaCare Illinois medical malpractice lawyers wage theft Illinois trucking safety Legal Info capital gains tax employee misclassification Arlington Heights wills and trusts attorneys Arlington Heights criminal lawyer fiduciary rule Illinois red light cameras insurance negligence marijuana drunk driving statistics Home Remodeling Repair Act power of attorney for healthcare disability benefits commercial leasing traffic accidents Illinois estate planning Buffalo Grove traffic lawyers Chicago employment attorney compensatory time Chicago trucking accident attorney federal crimes Crystal Lake personal injury lawyer Kenilworth estate planning attorney Buffalo Grove criminal defense lawyer Des Plaines real estate lawyer financial advisors fatal car accidents special needs trust Illinois Human Rights Act Affordable Care Act workers comp Rolling Meadows tax attorney commercial leases Illinois workplace lawyer home inspection lawyer Employment Discrimination Law Inverness corporate attorney living trust vs will jet ski accidents construction accidents, personal injury, wrongful death, Arlington Heights personal injury attorneys, workers' compensation DUI attorney estate plan drug crimes lawyer Des Plaines drug crimes lawyer accidental death benefits trucking accident lawyers Food and Drug Administration's Food Safety Modernization Act Illinois tax attorney Palatine drug lawyer Mount Prospect wills and trusts lawyers digital media accounts, estate planning, Arlington Heights estate planning attorney, Palatine workers compensation lawyer Exclusions Long Grove wills and trusts attorneys gift tax exemption, estate planning, estate planning strategies, Illinois estate planning, South Barrington estate planning attorneys Buffalo Grove personal injury attorney breathalyzer test bicycle dooring accidents car crash corporate law wrongful death Palatine punch death child safety personal injury claims Schaumburg medical malpractice lawyer golf accidents Deer Park accident attorney condo association Inverness real estate lawyer Buffalo Grove real estate attorney medical malpractice claims estate planning lawyer trusts Illinois personal injury crossover accidents federal regulations for LLCs criminal law fault based insurance cell phone tower data probate Chicago car accident lawyer Illinois will lawyer Joliet general practice lawyers Illinois injury lawyer commercial real estate Inverness estate planning lawyer South Barrington real estate lawyer texting and driving caregiver Barrington civil litigation attorney Illinois business lawyer Schaumburg employment attorney boating under the influence insurance dispute Chicago insurance law firm Buffalo Grove personal injury lawyer whistleblower protections Rolling Meadows probate lawyer Chicago insurance claim attorneys motorcycle accident lawyer caretaker rights Retaliatory Discharge trucking accidents Inverness accident lawyer car crashes Rolling Meadows personal injury lawyer South Barrington real estate attorney ACA Illinois employee rights attorney. estate attorney natural gas explosion Forcible Entry Illinois pedestrian accident attorney paid sick leave wills and trusts taxes anesthesia errors Arlington Heights insurance attorney employment law traffic offenses elder law institutional trustee IRA trust transfer traffic deaths bicycle accidents Des Plaines criminal attorney denial of life insurance unpaid assessment Palatine elder law attorney speeding Palatine trusts lawyer automated cars Palatine traffic accidents sole proprietorship Palatine civil litigation lawyer Riverwoods estate planning lawyer Schaumburg Attorney Schaumburg injury lawyer medical malpractice compensation homestead rights Barrington criminal defense lawyer Illinois real estate clemency Long Grove estate planning attorneys Illinois insurance attorney estate planning, death tax, succession plans, business estate plans, Barrington estate planning lawyers Crystal Lake estate planning lawyer natural gas Crystal Lake car accident attorney Crystal Lake business law attorneys Illinois insurance claims lawyers Palatine employment lawyer traffic tickets Palatine insurance lawyer cell phone Des Plaines medical malpractice attorney probate process advance healthcare directive Inverness elder law lawyer Schaumburg civil litigation attorney Des Plaines collections attorney Illinois criminal defense attorney Chicago employment lawyer medical malpractice, missed diagnosis, delayed diagnosis, medical mistake, Deer Creek medical malpractice lawyers Barrington real estate lawyer DNR loss of consortium Illinois bicycle safety Rolling Meadows employment law attorneys modern family estate planning unfunded trust Chicago corporate attorney Chicago will attorney Buffalo Grove corporate attorney Illinois real estate lawyer contracts Rolling Meadows traffic attorney Schaumburg estate planning attorney Landlord Tenant Ordinance Illinois medical malpractice attorney pedestrian injuries, pedestrian fatality insurance dispute attorney business litigation Schaumburg criminal attorney Crystal Lake injury attorney probate lawyer Inverness civil lawyer Illinois lawyer Do Not Resuscitate Colin H. Gilbert Illinois personal injury lawyer changes to mortgage law Rolling Meadows insurance attorney Arlington Heights estate planning attorney pedestrian-automobile accident murder distracted driving accident victims medication errors Barrington employment law attorney texting while driving Illinois corporate lawyer employment contract personal injury attorney employment lawyer Arlington Heights wills and trusts lawyers Illinois boating accident lawyer pet law rent to own real estate contracts Crystal Lake accident attorney Illinois insurance lawyer LLCs Des Plaines claims law firm Inverness real estate attorney Barrington estate planning attorney construction accidents Chicago biking tips Illinois home inspection defective products lawyer condo insurance denials foreclosed rental property Schaumburg criminal law attorney work unions Des Plaines personal injury attorney license revocation Barrington medical malpractice lawyers Illinois employment lawyer Illinois defective products attorney traffic laws personal injury Class A misdemeanor installment contracts landlord tenant law civil rights violation Illinois insurance dispute lawyers residential real estate Illinois wrongful termination lawyer workers compensation benefits Liquor Control Act Illinois living will probate claims Colin Gilbert Inverness probate lawyer Palatine probate lawyer Des Plaines accident attorney Arlington Heights Attorney Crystal Lake employment attorney IRELA attorney fees Rolling Meadows Traffic Lawyer Illinois registered agent truck collisions Palatine criminal defense lawyer eluding a police officer Crystal Lake insurance lawyer Illinois traffic ticket lawyer IRS icy parking lots Illinois Smoke Detector Act hit and run accident Arlington Heights car accident lawyer employment attorney privacy Deer Park criminal attorney Policy Cancellation medical marijuana social media after death slip and fall accidents pregnant women trauma after an accident hands free device Palatine personal injury lawyer Crystal Lake traffic lawyer liens spinal cord injuries Illinois DUI attorney suspended license Mount Prospect elder law attorney Kenilworth estate planning attorneys School Visitation Rights Act Rolling Meadows litigation lawyer Crystal Lake will lawyer deed transfer Illinois personal injury attorney involuntary manslaughter Des Plaines insurance claim power of attorney Illinois employment law Arlington Heights employment attorney nursing home negligence premises liability employment contract, employment law, employment at-will, Deer Park employment law attorneys, contract, insurance denial appeals Schaumburg elder law lawyer Crystal Lake medical malpractice law firm Illinois employment law attorneys tax attorney unpaid overtime insurance adjusters car crash injuries sexual images personal injury, auto accident injuries, delayed injuries, serious injuries, Des Plaines personal injury attorneys Illinois wills and trusts attorneys dram shop law Illinois Probate Act of 1975 Chicago traffic lawyer DGAA Arlington Heights wills and trusts attorney college kids Mt Prospect Attorney dog bites Mount Prospect real estate lawyer Illinois Workers’ Compensation Commission real estate contract Illinois elder law attorney Crystal Lake bike accident lawyer real estate attorney

Archive