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A new Rolls-Royce Phantom is displayed on the showroom floor at Rolls-Royce Motor Cars Long Island in Jericho, Long Island, in this 2012 file photo. The top 1 percent of income earners didn't escape a substantial tax increase for 2013. (Jim Sulley/newscast/Rolls-Royce Motor Cars/File)
2. Highest wage earners will pay more income tax
The one group that didn't escape an increase in income tax rates were the 0.7 percent of Americans who earn more than $400,000 a year as single taxpayers (or more than $450,000 as joint filers). For them, marginal income tax rates will rise substantially – from 35 percent to 39.6 percent. Three-quarters of taxpayers who make between $500,000 and $1 million would pay an average $10,000 extra in 2013, according to the Tax Policy Center. Some 98 percent of those earning $1 million or more would owe $125,000 more, on average.
The bill also restores caps on itemized deductions and phases out the personal exemption for those individuals making more than $250,000 ($300,000 for couples).
