Menu Contact
The Gartzman Law Firm, P.C. Tax Law Attorneys
Contact Us Today For A Free Phone Consultation

Capital Gains and Losses: New Twists for 2012 - Part Two

As I mentioned in a previous post called "Capital Gains and Losses: New Twists for 2012 - Part One", the end of the year is the traditional time for securities investors to "harvest" capital losses for federal income tax purposes. Part of my role as a tax attorney in Atlanta, is to educate my clients I wanted to share that there's an added wrinkle to capital gains and losses in 2012: the usual strategy of harvesting losses is a little more complicated this year due to three key tax law changes scheduled for 2013.

  • ONE - The maximum tax rate for net long-term capital gain will increase to 20% (10% for investors in the lower tax brackets).
  • TWO - Ordinary tax rates are going up. For example, the top rates of 33% and 35% will increase to 36% and 39.6%, respectively.
  • THREE - A special 3.8% Medicare surtax will apply to the lesser of net investment income for the year or the amount by which modified adjusted gross income (MAGI) exceeds $250,000 ($200,000 for single filers).

Barring any late legislation by Congress, investors may be inclined to harvest capital gains instead of losses at year-end. As a result, you can benefit from the favorable tax rates in effect for 2012. If you've already realized short-term gains in 2012, you might want to realize short-term losses to offset those gains. But don't use short-term losses to offset long-term gains, if you can help it, because long-term gains are taxed at a maximum rate of only 15% in 2012.

Other considerations may come into play. The best approach is to do what's best for your situation. Don't hesitate to reach out to our Atlanta Law Firm: at 770-939-7710 or Toll-Free: 1-866-945-5447

No Comments

Leave a comment
Comment Information

Contact Our Firm

The Gartzman Law Firm, P.C.
2851 Henderson Mill Road
Atlanta, GA 30341

Phone: 770-648-0689
Fax: 770-939-7743
Atlanta Law Office Map

Contact Us For A Free Telephone Consultation

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Get In Touch