The recent passage of the American Taxpayer Relief Act of 2012 has created opportunities and issues that some investors may not be aware of.

Here is a brief summary from Hefren-Tillotson of some the main provisions of the act to assist in your wealth management planning in 2013.

The estate/gift exemptions and portability have been made permanent and indexed for inflation. The annual inflation adjustment increased the yearly gift amount for 2013 by $1,000 to $14,000. It is important to remember that spouses can combine their exclusions, which allow them to give up to $28,000 per year to an unlimited number of people, up to their exemption amount of $5.25 million over their lifetime.

Qualified charitable distributions have been extended for 2013 and can be helpful for investors who have required minimum distributions (RMDs). This allows you to directly transfer up to $100,000 to a qualified charity from your IRA, satisfying a portion or all of your RMDs for the year. If this is done, you may not claim a deduction on this money for your taxes because these distributions are not included as income.

The individual tax rates stayed the same, except for the highest bracket which moved up to 39.6 percent. This is for single individuals earning more than $400,000 and married earning over $450,000. Capital gains rates also increased for the highest income bracket moving from 15 percent up to 20 percent for your long-term gains. Also, if your income is more than $250,000 filing single or $300,000 married filing jointly, the “Pease” limitations that were reintroduced will restrict some of the common tax deductions.

All taxpayers who pay into Social Security, regardless of income, will see a rise in taxes in 2013 with the expiration of the 2 percent payroll tax cut.

Contributions to qualified plans have increased for 2013. You may now contribute up to $17,500 to a 401(k), 403(b), 457, SAR-SEP, or thrift savings plan; $5,500 to traditional and Roth IRAs; $51,000 to SEP IRAs; and $12,000 to SIMPLE IRAs. The catch up contributions for individuals over the age of 50 remain the same.

This article was submitted by Hefren-Tillotson.