New Tax Laws for 2011

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Over the last decade, dozens of tax acts have been passed, filled with hundreds of changes to the tax law. But this year alone, there have been nearly a dozen new tax acts.

Ironically, nearly all of the new laws that affect individuals like you and me expire at the end of 2010.

Equifax personal finance blogger and tax expert Eva Rosenberg says most of the newly-passed laws affect corporations, providing credits, forcing health-care coverage, encouraging new hires, and both improving and confusing small-business bottom lines. But when it comes to working folks—or retired or unemployed folks—there’s not much in the tax law for 2011 that can be outlined. We're still waiting for Congress to act.

Here's what Eva Rosenberg foresees for 2011 if Congress does nothing:

  • The tax rate for next year—for all brackets—will increase. The 10 percent bracket will disappear. Rates will range from 15 percent to 39.6 percent.
  • Capital gains rates will go up. The top rate will be 20 percent (from 15 percent in 2010). The 0 percent capital gains rate will disappear. Long-term gains will be taxed at 10 percent for those in the 15 percent tax bracket.
  • Dividends will be taxed in full. For the last couple of years, we have enjoyed capital gains rates on our dividends. Now we could end up paying as much as 39.6 percent.
  • The child tax credit will be cut in half, to $500 per child. And only the lowest-income families (below $12,550) will receive refundable credits. (A refundable credit is one where you get money back even if you paid in nothing.)
  • The marriage penalty will return. The standard deduction for married couples filing jointly will drop from twice the standard deduction for singles to something more like 80 percent of what it used to be.
  • There will no longer be a deduction for mortgage insurance premiums.
  • Your dependent care credit expense will drop from $3,000 per child (for up to two children) to $2,400 per child.

    Sound bleak? Read what else Rosenberg expects, (including some reasons to be hopeful!) here:



Ilyce Glink is the author of several books, including 100 Questions Every First-Time Home Buyer Should Ask and Buy, Close, Move In!. She blogs about money and real estate at, The Equifax Personal Finance Blog and CBS Moneywatch She is Chief Content Strategist at, a community for real estate investors. 


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  1. Wallace S. Gibson, CPM 11/10/2010 02:12 AM
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Chuck Carstensen
RE/MAX Results - Elk River, MN
Minnesota Real Estate Expert

I am all for tax breaks but with the spending going on it will be hard for me to believe they will cut it back.

Nov 10, 2010 01:51 AM #1
Deborah Byron Leffler BzyBee Real Estate Lady!
Keller Williams Realty Boise - Nampa, ID

WOW...I hadn't heard of all of these...some I had heard of...will be interesting to see how it plays out!

Nov 10, 2010 01:55 AM #2
Wallace S. Gibson, CPM
Gibson Management Group, Ltd. - Charlottesville, VA

The very FIRST order of business for new congress is to EXTEND or MAKE PERMANENT the Bush Tax Cuts.  We are becoming a nation of landlords who are renters and FAST!  Between the increase in health care costs and increased tax rates, many businesses will not be able to survive much less increase employment.

Nov 10, 2010 02:12 AM #3
Lottie Kendall
Pacific Union International - San Francisco, CA
Serving San Francisco and the Silicon Valley

The folks at the bottom, who are barely surviving, get hit the hardest if some of these current tax strategies aren't extended. Hopefully congress will stop their posturing and protect those who need it most.

Nov 10, 2010 04:00 AM #4
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Ilyce Glink

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