Think Only the Rich Will Pay More Taxes? You're Wrong

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You followed all of the debate over the fiscal cliff and were relieved to hear that taxes were only going up for the rich this year.

Well, you were wrong.

Because neither party wanted to defend it, the temporary payroll tax cut enacted under Obama died at the end of 2012, which means that everyone in the country will see a bigger tax bite out of their paychecks this year. So when you get your first check of the year, look at the amount charged under "FICA" – you're going to be paying more than you did in December.

How big a bite is it? For many middle class workers, it will work out to a trip to the grocery store or a tank of gas less every two weeks this year.

Here are the numbers.
For a single person making $60,000 per year who's paid bi-weekly, gross income in a paycheck is $2,307.69.
In December, you would have had to subtract from that federal withholding taxes of $403. 56. FICA taxes were $96.93. Medicare was $33.46. State withholding for a person living in Maryland was $177.35.
That gives the taxpayer net pay in one check in December of $1,596.39.
So what happens this month?
Gross pay is the same, as are the Medicare and state taxes. But FICA taxes go up sharply – to $143.08. That's a $46.15 bite from the political decision to allow the payroll tax cut to expire.
But here's the good news – federal withholding from this paycheck are down by about 4 bucks, to $399.18, due to the way the federal government calculates inflation.
That gives our taxpayer net pay of $1,554.62, or $41.77 less than he or she made for each paycheck in December. And that's money that could have gone to that bag of groceries or tank of gas.

CNBC.com Article: Boomers Stand to Benefit Most from Health-Care Act

Boomers Stand to Benefit Most from Health-Care Act
Hit hardest by unemployment, shrinking nest eggs and rising health care costs, the Baby Boom generation will be the main beneficiaries of the Affordable Care Act, according to experts.



With the presidential election and Supreme Court decision behind us, the federal government is moving forward with the Affordable Care Act. Baby Boomers stand to gain the most.
Since the recession, Boomers have been hard hit by unemployment, shrinking nest eggs and rising health care costs. During those years, about 8.6 million Boomers were without health insurance, according to a special 2009 report by Commonwealth Fund.
As the Boomer generation approaches retirement, many hope that the health care law will fill the void. "It is a game changer," says Ron Fontanetta, a health care group practice leader at Towers Watson. "It will provide health care access to pre-65 retirees in a very significant way."
Retirees who have not reached age 65 are more at risk -- they don't qualify for Medicaid, and if their former employers don't offer retiree health benefits, they will not have a group discount.
Also, it doesn't take much for a health insurance company to say that they have a pre-existing condition and deny them coverage, says Paul Fronstin, head of health benefits research at EBRI. Even if Boomer retirees can get a private health insurance plan, it will be very costly.
Based on their age alone, Boomers have to pay prices that are five to seven times higher than younger Americans, according to AARP. But if early retirees can wait until the ACA takes effect, it will change the playing field, says Fronstin.
-- Beginning in 2014, the law is supposed to prevent insurers from denying coverage to those who have a pre-existing condition. On Nov. 20, the Obama administration said that it was moving forward to implement provisions to ban discrimination and protect consumers from possible insurance abuses.
--The ACA also will do away with lifetime and annual dollar limits on benefits, and it will limit the age rating so that a Boomer can only pay three times as much as younger person.
--Health insurance will not necessarily be less costly. It will be operated by state health insurance exchanges, which will offer a competitive private health insurance market that should provide one-stop shopping.

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http://www.cnbc.com/id/100343188/