Posted by: Michael Hermes, Tax Senior 

For some high-income taxpayers, their tax liability due to the IRS was unusually high this past tax season, and not for the most obvious reason–the 2013 increase in the top income tax rates.

Instead, some high-income taxpayers were subject to the new Net Investment Income Tax (NIIT), a complex additional 3.8% levy on certain investment income.            

There are many factors to consider when making an investment, but, when comparing taxable investments to tax-exempt investments; one important aspect is the after-tax return of the investment. Depending on your tax bracket and state tax consequences, the difference on the return between taxable and tax-exempt investments can be significant.

Read more on taxable versus tax-exempt investments here.