For each taxable year, the MAGI, after being reduced by a fixed threshold, is compared to NII.
FORBES: What the New 3.8% Medicare Surtax Means for You And Your Investments
The last part of the NII determinant refers to any net gain from the disposition of a property.
However feasible turtle-driven eco-tourism might be, it is a rather distant prospect for ordinary fishermen such as 35-year-old Nii Ashietey.
However, NII is not the only important term that is critical when determining the effects of the 3.8% Medicare Surtax amounts.
The first is that increases in NII will always increase the amount subject to the 3.8% Medicare Surtax by the same quantity.
NII, which consists of three parts reducible by certain deduction, plays a critical role in determining the effects of the 3.8% Medicare Surtax.
One recent example is NII Holdings (NIHD), a wireless services company based in the U.S. that does businesses Brazil, Mexico, Argentina, Peru and Chile.
In addition, since only a net gain is recognized, the smallest amount that this third NII component can be in any taxable year, is zero.
The proposed regulations create three different income-type buckets, and they limit each bucket to zero, not allowing buckets with net losses to be counted in NII.
FORBES: IRS Should Fix Net Investment Tax Proposed Regulations
Because of this, the IRS strives to provide a comprehensive definition of NII to guide taxpayers as they calculate their 3.8% Medicare Surtax amounts this taxable year.
As we saw with NII Holdings, when the competitive landscape shifts and the management team is not able to respond it may be time for a change.
How can anyone justify loss limitations with NII and NIT?
FORBES: IRS Should Fix Net Investment Tax Proposed Regulations
Nii-Azu Kojo-Smith, 18, of Hackney Wick, east London, denies murder.
The Nuclear Installations Inspectorate (NII) has carried out an investigation.
Based on our interpretation of the code, in this example all unearned income, loss and expense is zero, and NII matches unearned income or loss calculated in gross income.
FORBES: IRS Should Fix Net Investment Tax Proposed Regulations
Our biggest problem is that the proposed tax regulations could cause serious damage to traders and other taxpayers by limiting various types of losses and expenses from their NII calculations.
FORBES: IRS Should Fix Net Investment Tax Proposed Regulations
Since the IRS intended the 3.8% Medicare Surtax to place a tax on investment income, it is natural that income from standard forms of investment assets are included in the NII sum.
Although not included as an income tax rate increase, next year individuals will be reporting and including the new Net Investment Income (NII) tax (also known as the Medicare surtax) with their Form 1040.
Namely, the IRS states that rental real estate activities income might be included in either Part A of the NII composite, which includes general sources of investment income, and Part B, as being passive to the taxpayer.
FORBES: Not so Fast: an Additional Obstacle for Real Estate Professional in the 3.8% Medicare Surtax
This means that as MAGI increases, when MAGI above a threshold surpasses the amount of NII that the taxpayer has, then the 3.8% Medicare Surtax switches over and instead of being applied on the adjusted MAGI amount, it is now applied on the NII amount.
To illustrate, if a taxpayer owns an interest in an S corporation that earns a certain amount in income and distributes half the sum to the taxpayer, the taxpayer would include the amount in his calculation of the NII sum if he does not materially participate in the S corporation.
Unlicensed National Information Infrastructure (U-NII) devices today operate in 555 megahertz of spectrum in the 5 GHz band, and are used for short range, high speed wireless connections including Wi-Fi enabled local area networks and fixed outdoor broadband transceivers used by wireless Internet service providers to connect smart phones, tablets and laptops to the broadband network.
ENGADGET: FCC proposal hopes to grow WiFi spectrum by 35 percent, reduce hotspot congestion
However, taxpayers should note that Code Sec. 1411 is to follow normal income tax rules (i.e. rules that a tax lawyer or accountant might refer to as tax rules under chapter one of the Internal Revenue Code), so for ease of calculation, what is exempted from the regular income tax, such as tax-exempted mutual bonds, are also excluded from the NII sum.
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