NEW YORK, July 3, 2012 — The recent Supreme Court decision on the healthcare law means that it's the law of the land. Buried in over 2,000 pages are a wide range of tax and other financial provisions that affect individuals now and into the future. Now is the time for investors to carefully review the upcoming changes and make adjustments as necessary. Financial planner Zaim Hajdari has reviewed the law, noted some of the most significant changes and explained why investors may need to reconsider their investments. He is available to discuss further details.
The taxpayers who will see the biggest changes are couples with modified adjusted gross incomes (MAGI) of at least $250,000 and individuals with MAGI's of $200,000 and up.
More out of the paycheck. Starting next year, those with high levels of earned income will pay an additional 0.9% Medicare tax.
Investments take a tax hit. Also starting next year, the law imposes a 3.8% Medicare tax on dividends and certain capital gains, for those whose MAGI exceeds certain thresholds.
Harder to deduct medical expenses. In the past, the threshold for deducting unreimbursed medical expenses was 7.5% of adjusted gross income. Next year, that goes up to 10%.
But it's not all about new expenses – clients can take other things out of their budgets. For example, the law calls for increased coverage of women's health preventive services. And children can stay on their parents' plans until they're 26.
Also, retirees get a break – distributions from pensions, traditional IRAs or defined-contribution plans (such as 401k's) will not be subject to the new 0.9%/3.8% taxes.
Reconsidering Investment Strategies
Some companies will do better than others in this new environment, and investors with exposure to various healthcare and medical companies will need to take a fresh look at their portfolios. And with the new additional dividend tax, dividend-paying companies may not be as attractive for some investors. Municipal bonds, however, do not appear to be subject to the new tax.
Also, investors may want to sell certain securities and realize capital gains within the next six months, before the new, higher rate kicks in after the year-end. "However, taxes are just one factor when making investment decisions, and investors are encouraged to consider all aspects of their tax situation and investing goals with a professional financial planner," says Hajdari. "This is especially important in light of the complexities in the new law."
About The Hajdari Group
The Hajdari Group ) is an independent firm in New York. President Zaim Hajdari is a Chartered Retirement Planning Counselor with 18 years experience. Hajdari provides financial planning and advisory services.
Hajdari is also the branch Manager of Raymond James Financial Services (securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC). Hajdari was formerly an investment manager with JPMorgan Chase where he oversaw over $3 billion in client assets.
Contact:
Alexis Kazarian, Office Manager
Email
212-883-4049
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