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

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

Archive