The Health Care Reform Legislation enacted in 2010 significantly broadens the Medicare tax base for higher-income taxpayers by enacting two new taxes. Beginning in 2013, higher-income taxpayers will be subject to an additional 0.9% tax on earned income and a new 3.8% tax on investment income.
The President has signed into law the Tax Relief Act of 2010 on December 17, 2010. This law broadly changes the estate, gift, and generation-skipping transfer (GST) tax rules for 2010, 2011, and 2012, and then permits the pre-EGTRRA 2001 law to be resurrected on January 1, 2013.
Congress has passed a comprehensive set of income tax, estate tax and unemployement insurance provisions as outlined by the deal previously negotiated between President Obama and Republican legislators. The following explains the Act in five sections: