Low-income workers. A 2009 change in the earned income tax credit, which expanded cash tax refunds to low-income workers, was extended for another five years in the fiscal cliff fix.
Losers
Workers. While the fiscal cliff fix extended many tax breaks for individuals and businesses, the 2010 payroll tax cut that dropped employees' payroll tax contribution 2 percentage points, from 6.2 percent to 4.2 percent on income up to $106,800, was allowed to expire. The ceiling on wages subject to the FICA tax has since increased to $113,700 for the 2013 tax year.
For a worker making $50,000 per year, the tax increase amounts to an extra $1,000 in payroll taxes paid annually, says Eisenberg.
The mass affluent. Just because they avoided a higher income tax rate doesn't mean the mass affluent will get away entirely unscathed from the fiscal cliff fix, says Eisenberg.
"There is a phaseout of itemized deductions for single people making over $250,000 and couples with income over $300,000," Eisenberg says. While their marginal tax rates may not be going up, such deductions, which cover everything from mortgage interest to miscellaneous business expenses, will shrink for higher earners in 2013, increasing their overall tax burden, Eisenberg says. Their Schedule A claims will be gradually reduced, possibly as much as 20 percent, in 3 percent increments, based on how much income they make in excess of their income threshold.
Personal exemptions -- those exemptions claimed for taxpayers and their dependents -- similarly will be phased down in 2 percent increments for mass-affluent taxpayers.
Top earners. Americans in the very highest income brackets will take some tax lumps from the new law, says William McBride, chief economist for the Tax Foundation. Single taxpayers earning more than $400,000 and couples earning more than $450,000 will see their rates go up from 35 percent currently to 39.6 percent. Add that to the limits on deductions for high earners, and you've got a potent tax hit, he says.
"Together those two items basically raise the effective tax rate on high-income earners about 3 or 4 points," McBride says.
Wealthy investors. For taxpayers in the higher tax brackets, long-term capital gains tax rates will rise from 15 percent to 20 percent. That means high-earning investors who make money from selling stocks, real estate and other investments they've owned for more than a year will pay more than they did in 2012.
That higher 20 percent rate will also apply to qualified dividends, Eisenberg says.