In January, the fabled 3.8% surtax on investment income becomes law. This surtax, included in health care legislation to bolster Medicares finances, is based on two key numbers. The IRS has just issued proposed regulations on one of those numbers: net investment income.
The other key numbermodified adjusted gross incomeis relatively easy to determine. For this surtax, MAGI is usually the same number as the AGI reported on a tax return. The 3.8% surtax will affect taxpayers with MAGI over these thresholds: $250,000 for married couples filing jointly and qualifying widow(er)s with a dependent child; $200,000 for singles and heads of household (with a qualifying person); and $125,000 for married individuals filing separately.
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