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Income Tax Planning
Chapter 11: The Taxation of Capital Assets/3.8% NET INVESTMENT INCOME TAX (NIIT)
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Chapter 11: The Taxation of Capital Assets

3.8% NET INVESTMENT INCOME TAX (NIIT)

01.Core Concepts

• Applies to the lesser of: 1. Net investment income, or 2. MAGI over threshold amount (not indexed): • MFJ – $250,000 • MFS – $125,000 • Single – $200,000 • Net investment income includes portfolio income, income from passive activities, and gains on disposition of property, but does not include distributions from qualified plans or IRAs. • Capital gains for those above the threshold amounts may be taxed at 18.8% or 23.8% instead of 15% or 20%.