When we think of the word sunset, an image of colorful beauty may emerge, and we may remember that we missed a great photo of sun, clouds, and horizon. In the TAXSPEAK arena, there is an entirely different meaning.

A tax rule that is called “sunset” is one that expires after a certain date. The “Tax Relief Reconciliation Act of 2001″, had several expiring provisions which affected the personal tax rates in general, and the dividend and capital gains tax rates in particular. These changes are effective in the tax year 2013.

For taxpayers whose taxable income is above an “applicable threshold”, the highest tax rate in 2013 increased from 35% to 39.6%. Also the tax rate on “qualified dividends” and long term capital gains is now 20% instead of 15%, for those above the threshold. The thresholds are $450,000 for taxpayers who file “joint returns”, $425,000 for “heads of household”, $400,000 for “single” filers and $225,000 for “married taxpayers filing separately.’