Sometimes tax hikes fly under the radar. We are all concerned with our marginal tax rates, sales tax rates, and property tax rates. But what about the "other" taxes, fees, and things filed under "misc?"
Until 2005, the tax on a child's unearned income, such as dividends, interest and capital gains, was paid at the parents' marginal rate if the child was under age 14. Last year, the age limit was raised, requiring children under age 18 to be taxed at the parents' rate. Now, starting in tax year 2008, the age limit will apply to children under age 19 -- or to "kiddies" who are full-time students under the age of 24. By closing that opportunity, the government expects to collect as much as $1.5 billion in extra tax revenues over the next 10 years. |
