Tag Archives: fiscal cliff

The American Taxpayer Relief Act of 2012 was signed into law on January 2nd. Although the recent headlines suggest the “fiscal cliff” was averted with this legislation, for most business owners, dealing with significantly higher tax rates is now a reality. With few exceptions, the higher tax rates deemed problematic by congressional Republicans are now in effect for persons with taxable income in excess of $450,000. Of course, this threshold includes income allocated to owners by any business operated as a “pass-through” entity such as an S corporation or LLC. For the owners of these businesses, the $450,000 threshold will quickly be reached assuming the business is profitable.