So you'd end up paying 1.45% on the first $200,000 and 2.35% on the rest. The 0.9% Medicare surtax is a recent change and is intended to help pay for health reform. Investment income taxes: Capital gains, dividends and interest represent unearned income..
The tuition and fees deduction sounds good on the surface; it offers up to a $4,000 deduction. This option is open even if you donât itemize deductions. But since the deduction is for the taxpayer, not the student, it may not be the most beneficial for taxpayers with more than one student in the family.
The maximum deduction is $10,000 for each eligible student. The college tuition itemized deduction may offer you a greater tax savings if you itemized deductions on your federal return. Use the worksheets in the instructions to compute your deduction and see if the credit or deduction is better for you.