Change in Capital Gain Rate Drove Year-End Sales of Capital Gain Property – Los Angeles Income Tax Planning and Income Tax Litigator Attorney Bruce Givner

by Bruce Givner on February 11, 2013

Many owners of capital gain property, such as stocks, or a business and real estate, sold that property on or before December 31, 2012.

Why? Because they knew that on January 1, 2013, the capital gain rate would significantly increase over 8%, from 15% to 23.8%.

Now that the tax rates have increased, tax planning designed to reduce or minimize the tax on the sale of a capital asset is potentially (23.8% divided by 15% = ) 58.7% more important than it was before January 1, 2013. And that is without taking into account the increase in California taxes to as much as 13.3% (from 10.3%, a 29% increase). So, for example, if you plan on selling a capital asset more than two years from now, the time to do the planning is now due to a special rule regarding installment sales. Of course other structures, e.g., tax deferred exchanges and charitable remainder trusts, are still powerful planning techniques.

If you have capital gain property you want to sell, there are less than two months before the capital gain tax rates increase. Givner & Kaye focuses on sophisticated income tax planning and compliance, tax litigation and procedure, estate planning, and asset protection plans for individuals and businesses in Beverly Hills, Calabasas, West Los Angeles, Hollywood, and other areas of Los Angeles, Orange, Ventura, San Bernardino, Riverside and Santa Barbara Counties. Call Los Angeles Estate Planning and Asset Protection Plan Attorneys Givner & Kaye at (310) 207-8008 today.

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