Reuters - Video

Edition: US | UK | IN | CN | JP

video Video

Bernanke steps into the spotlight
Bernanke steps into the spotlight - 02:13
The official royal wedding guest list revealed
The official royal wedding guest list revealed - 01:23
Shuttle astronauts arrive at Cape Canaveral
Shuttle astronauts arrive at Cape Canaveral - 01:18
Waiting for Bernanke
Waiting for Bernanke - 01:51
Hospital staff flee border fighting
Hospital staff flee border fighting - 01:10
Thousands at Sai Baba funeral
Thousands at Sai Baba funeral - 01:03
Al Qaeda releases hostage messages
Al Qaeda releases hostage messages - 01:43
Obama calls birth controversy \
Obama calls birth controversy "distracting" - 05:29
Three blasts hit Kirkuk
Three blasts hit Kirkuk - 01:25
Protests intensify in Yemen
Protests intensify in Yemen - 01:24
Border clashes displace thousands
Border clashes displace thousands - 01:50
S&P Credit Rating Warning Helpful - Lister
S&P Credit Rating Warning Helpful - Lister - 00:53

What's a wealthy investor to do?

Wednesday, January 02, 2013 - 01:52

Jan. 2 - Now that Congress has reached a deal to avert the fiscal cliff, what should high-income earners do now that they're facing their first major tax increase in 20 years? Sasha Salama reports.

▲ Hide Transcript

▶ View Transcript

Now that Congress approved a deal to avert the fiscal cliff, the wealthiest Americans will be hit with the biggest tax increases they've seen in years. So what do they do now? Under the deal, income tax rates will increase from 35 to 39.6% on income above $400,000 for individuals and $450,000 for married couples. According to the Tax Policy Center, households making between $500,000 and $1 million in 2013 will get an average tax increase of nearly $15,000. Households making more than $1 million will get hit with more than $170,000 in taxes on average. The deal sparked a relief rally on Wall Street even though the measure would raise long-term capital gains taxes for high income earners to 20% this year from 15% last year. Even so, experts say wealthy investors with an appetite for risk should not shy away from equities. Gary Schatsky is President of ObjectiveAdvice.com. SOUNDBITE: GARY SCHATSKY, PRESIDENT, OBJECTIVEADVICE.COM (ENGLISH) SAYING: "You're just earning a little bit less. So the key is to balance your risk tolerance along with the tax advantage of capital gain growth." With capital gains being taxed at higher rates, experts say tax-free investments are looking better than ever for the wealthy. SOUNDBITE: GARY SCHATSKY, PRESIDENT, OBJECTIVEADVICE.COM (ENGLISH) SAYING: "Municipal bonds are a lot more attractive now. The higher the tax rates go, the greater the enticement and advantage of getting tax-free income". Investment advisers add that it's more important than ever now for people in the top tax bracket to contribute the most they can to their retirement accounts because those contributions are fully tax-deductible.

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

Close

What's a wealthy investor to do?

Wednesday, January 02, 2013 - 01:52

Featured Videos

Spanish paraglider becomes part of a natural phenomenon of starlings

Spanish paraglider becomes part of a natural phenomenon of starlings

Paraglider Horacio Llorens became part of a flock of starlings to embrace his dream of flying like a bird
Europe's largest freshwater aquarium opens in Switzerland

Europe's largest freshwater aquarium opens in Switzerland

It houses 10,000 fish and 100 reptiles, that are almost exclusively endangered or threatened species
Bearing up well - Duchess of Cambridge dances with Paddington

Bearing up well - Duchess of Cambridge dances with Paddington

Pregnant royal Kate dances with the famous bear at a charity event at London's Paddington station
Mice with green feet demonstrate CRISPR gene editing technology

Mice with green feet demonstrate CRISPR gene editing technology

British scientists are testing cutting edge gene editing techniques in mice, by inserting a jelly fish gene that makes their skin green
Virgin backs 'Hyperloop One'

Virgin backs 'Hyperloop One'

British billionaire Richard Branson has announced his Virgin Group will become a partner in ''Hyperloop One'', a super train conceptualized by Elon Musk to ferry passengers from New York to Washington, D.C. in less than an hour