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Burlington, VT office 802.540.0529
Hanover, NH office 603.643.6072
Rutland, VT office 802.773.3822
Woodstock, VT office 802.457.9492

January 4, 2013 Newsletter Archive


Taxpayer Relief Act 2012: A Brief Guide

As we enter our traditional New England deep freeze we wish you only the warmest thoughts for the New Year. This month we discuss the much anticipated highlights of the work of the last days of the 112th Congress. Public opinion denounced this particular group as "do nothings" and as we teetered on the precipice, we at Melendy Moritz wondered whether we would have any news to report at all. However, in the post-eleventh-hour, Congress averted its self-made crisis.

The predictability borne by the permanency of the Taxpayer Relief Act provides an opportune time to review your current estate plan. We recommend that you implement a well thought out estate plan for yourself, and to protect your family, whether or not you are subject to an estate tax, and this should typically include a revocable trust, will, financial durable power of attorney, and advance directive.

Please call our office at 603/643.6072 or
802/457.9492 to make an appointment.

Below is a summary of the legislation which would allow tax rates to rise on the nation's highest income earners. It also extends several tax cuts for individuals and businesses. Some key provisions in a nutshell:

The Estate Tax:

Income Tax Rates:

Other Income Tax Changes:

Income Tax Exemptions and Itemized Deductions:

The Payroll Tax:

Tax Credits:

CLASS Act repeal:

Commission on Long-Term Care:

Though many Americans will not be subject to federal estate tax, Vermont taxpayers are currently still under the de-coupled Vermont estate tax exemption amount of $2.75 million. We will continue to keep you posted on any changes the Vermont legislature might make regarding the state estate tax exemption.

Note that deficit reduction will remain a constant issue well into the 113th Congress. Congress will likely engage in tax system reform conversations, including non-retirement accounts, exemptions, tax code "loopholes" and charitable tax deductions. Entitlement reform will also be a major challenge for the 113th Congress with the Medicaid and Medicare programs facing increased scrutiny due to the mounting pressure to decrease the federal deficit and curb spending. Many of the same proposals that were a part of the National Commission on Fiscal Responsibility and Reform (Simpson/Bowles), Representative Paul Ryan's budget proposal, and other deficit reduction proposals will be a part of the discussion again this year.

Sources: Reuters News and Tax Analysis; Merchants Trust Company; Bloomberg BNA; NAELA Public Policy Update

Important Disclaimer: IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code, or (ii) promoting, marketing or recommending to another party any matters addressed herein.


Melendy Moritz PLLC is a client centered boutique firm. We focus on your unique needs by providing the individualized legal counseling and advising tailored to your specific situation.

We concentrate on the planning that matters to you.
Call us at 603.643.6072 or 802.457.9492


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