Trust Investment Income subject to Medicare Surcharge


The Health Care and Education Reconciliation Act of 2010 imposes a Medicare contribution tax of 3.8% on unearned income of individuals, estates, and trusts. The net investment income tax applies to most trusts and estates beginning January 1, 2013. Trusts that are treated as business entities, certain state-law trusts, tax-exempt trusts, and grantor trusts are exempt from the tax.


How does the Health Care Reform affect me?

05-26-2013Health Care

The Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (often to as “Obamacare” or “Health Care Reform”) was signed into law in March 2010. (The law was upheld as constitutional by the U.S. Supreme Court in June 2012.)

The primary purpose of the law is to extend health care to millions of uninsured Americans. Here is a summary of how it may affect you so you can prepare for the short- and long-term impacts before they occur.


How will the IRS know if I have medical insurance or not?

05-26-2013Health Care

A self-employed client asked how the Federal government and the IRS will know in 2014 if she was or was not covered by health insurance. She does not currently have coverage and was evaluating not making any changes. However, unless she told the IRS, how would the government know to assess a penalty?


What increases your chances for an IRS audit?

05-18-2013Tax Information

While there is no fool proof way to guarantee your income tax return will not result in an audit by the Internal Revenue Service, there are a few things that can help you avoid way about 1.5 million Americans experience.

A return can be flagged randomly in an IRS study of the behavior of similar taxpayers, such as those in the same profession. Audits often result from:


Tips for Students with Summer Jobs

05-17-2013Children & Students

If you are a student or have a student in your household starting a summer job, please remember:

1. Fill out a Form W-4, Employee’s Withholding Allowance Certificate. Employers use this form to figure how much federal income tax to withhold from workers’ paychecks. If the student did not pay income taxes last year and does not expect to make enough to pay this year ($4,000 is probably a safe estimate), the student can file as “EXEMPT” from taxes and not have any withholding.


Arizona Sales Tax Reduction coming June 1, 2013

05-01-2013Tax Information

The 1% Temporary Transaction Privilege Tax approved by Arizona voters in May 2010 will expire June 1, 2013. That means more money in your pocket.