legislation signed into law by President Clinton after passing both House and Senate by the narrowest of margins. Some highlights effective at that time were tax rate increases for high-income earners (new 36 and 39.6% tax brackets) and higher alternative minimum tax rates. Social Security recipients with incomes above $44,000 ($34,000 if single) might have to pay tax up to 85% of their benefits. The Act also increased the gasoline tax by 4.3 cents and raised the corporate tax to 35% for income above $1 million. Many provisions have since been altered.
act designed to help reduce the federal deficit by approximately $496 billion over five years through a restructuring of the tax code. The following include some of the major provisions that will have an impact on financial planning:
- Establishment of a new top tax rate on ordinary income (wages, interest, dividends, etc.) of 36% on taxable income alone:
