As you may have already heard, the foreboding “Fiscal Cliff” was narrowly avoided recently with the passing of legislation on January 1, 2013. The legislation, titled the American Taxpayer Relief Act, allows Bush-era tax rates to sunset for individuals in the top tax brackets; permanently patches the alternative minimum tax (AMT); revives expired or expiring tax extenders; provides for a maximum estate tax of 40 percent with a $5 million exclusion; and delays sequestration. Here we outline some of the most impactful changes brought about by this federal legislation.
