Turbo Tax 2014 and Tax Changes
With TurboTax 2014 you'll be ready for the Changes to come in 2014. These changes stand to be spread over several topics and will effect most Americans.
Turbo Tax 2014 Editions:
Free Edition, Basic, Deluxe, Premier and Home + Business
For 2014 many middle-class families that buy their own coverage may still be unable to afford it, and
therefore risk being assessed
a penalty under new laws.
Fortunately the Senate Finance Committee voted to pare down the penalties and postpone them until 2014. Since the fines are set to be collected through income taxes, no one will get a bill until April 2015.
This would be two full years after the government starts handing out carrots in the form of health insurance credits to be taken on your return filing. As usual with politics this would also be safely after the 2014 congressional midterm elections, go figure...
Effective Rates in Future Years Under Current Law
By 2014, nearly 22 million taxpayers may be subject to the alternative minimum tax (AMT). Overall, then, under current law, the effective federal rate will have increased from 21.5 percent in 2001 to 24.1 percent in 2014. This is sure to effect our refund amounts.
Because legislation enacted in
2001 focuses primarily on individual income, the pattern of changes to the
total effective rate over the 2001-2014 period comes almost entirely from
changes in the effective individual filing rate.
The effective rate for the lowest income sector increases from 5.4 percent in 2001 to 8.3 percent in 2014; in contrast, the rate for the top quintile climbs from 26.8 percent to 28.8 percent and that for the top 1 percent of taxpayers rises from 33.0 percent to 33.6 percent over the same period.
The differential increase in effective rates among income sectors is reflected in a shift down the income distribution in shares of taxes paid. The share of taxes paid by the top income earners falls from 65.3 percent in 2001 to 62.8 percent in 2014, even though that group's share of income does not change. Four-fifths of that decline occurs for the top 1 percent of taxpayers, whose share falls by 2 percentage points, to 20.7 percent of federal taxes in 2014. The share of taxes paid by each of the middle three income sectors climbs by about 0.7 percentage points.
TurboTax 2014 along with changes in laws will explain much of the expected changes in effective rates, but effective rates would change over time even in the absence of changes in the law, effecting our return filing.
Income taxes are indexed not for the
rise in real income but, rather, only for inflation or not at all.
Separating the effects of changes in the law and income growth requires
calculating the changes in rates that would result from income growth alone.
Relative to the situation in 2000, the three major laws enacted between 2001 and 2003 reduce effective federal rates for each income level in every year from 2001 through 2010. With the expiration of most provisions in 2005, the reduction lessens but then is partially restored in 2008 for the top earners and in 2010 for the bottom four brackets. With the sunset of EGTRRA in 2010, federal law reverts in most respects to that in effect in 2000, and by 2014, effective rates for all income brackets return to the levels obtained under 2000 laws.
The AMT grows in importance over the next decade, but its impact differs among income levels and under different laws. The AMT raises effective rates above what they would be in its absence.
All these changes are challenges that TurboTax 2014 Software continually meets when making software adjustments that ensure all benefits and credits are discovered for each individual.
How the Obama Health Care Legislation will Effect You:
Individual provisions Important provisions affecting individuals include:
Penalties for the uninsured.
Beginning in 2014, most individuals who arenít eligible for Medicaid,
Medicare or other government-provided coverage will have to purchase minimum
essential health coverage. Those who fail to do so will be hit with a
penalty (with exceptions for the poor and certain others).
Premium assistance for those with lower incomes. Beginning in 2014, people with income between 133% and 400% of the federal poverty level (FPL) are eligible for credits or cost-sharing subsidies on a sliding scale to help pay insurance premiums.