Author - Gabriel J. Markiz, CPA/PFS, CFP®

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Medical Residents Working Full Time Are Subject To Payroll Taxes
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What The New Tax Laws Mean For The Estate Tax Exemption Portability

Medical Residents Working Full Time Are Subject To Payroll Taxes

On January 11, 2011, the Supreme Court held in the Mayo case, that medical residents working full time were subject to payroll taxes. Previously, in 2009, the Eighth Circuit Court of Appeals reversed the earlier District Court decision concerning the payroll tax treatment of medical residents working for the Mayo Foundation for their residency program.  The District Court held that physicians pursuing additional education in their chosen specialty at the Mayo Foundation, for payroll tax purposes were treated as students and thus exempt from the taxes.

The IRS challenged the District Courts interpretation of students as exempt at The Eighth …

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What The New Tax Laws Mean For The Estate Tax Exemption Portability

Back in 1997, the lifetime estate tax exemption was $600,000 and the top estate tax rate was 55%.  The exemption increased through 2009 to $3,500,000 while the top tax rate declined to 45%.  For tax years 2011-2012 the exemption amount is $5,000,000 with a top tax rate of 35%.   However, in those prior years if the first spouse to die could not fully utilize the exemption amount because the value of the estate was below the exemption amount, the excess was lost forever.  For tax years 2011 and 2012, the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of …

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