I’m sure you’ve heard about it. The “fiscal cliff” is what we call it. A metaphor created by Fed Chairman, Ben Bernanke, to describe the financial pain and discomfort associated with the death of the so-called Bush Tax Cuts. The deadline for Congress to act to prevent going over that cliff is December 31st.
So, what exactly can YOU expect to pay in increased taxes if Congress fails?
The folks at Yahoo News had this estimate:
“The nonpartisan Tax Policy Center says that if all the scheduled tax increases occur, the average household would have to fork over an extra $3,400 to Uncle Sam next year. Here’s the average hike taxpayers would face, broken down by income group:
–Lowest fifth of households (average income: $11,239): $412
–Second-lowest fifth (average income: $29,204): $1,231
–Middle fifth (average income: $49,842): $1,984
–Second-highest fifth (average income: $80,080): $3,540
–Highest fifth (average income: $178,020): $14,173
–Top 1 percent (average income: about $1.3 million): $120,537
The biggest hit for most people would come from the expiration of the 2001 and 2003 tax cuts, which would raise income-tax rates for everybody by 3 to 5 percentage points, depending on the tax bracket. Those changes alone would raise the tax rate for a family earning $80,000 from 25 percent to 28 percent, resulting in about $1,450 worth of new taxes.”
President Obama says he’s ready to compromise…except on taxes assessed the highest income earning Americans. I’m sure he’d love to lower the taxes on the majority of voters, but he’s dead set on doing so at the expense of the wealthy. From the above table, it would seem that he might be doing so at the expense of everyone.
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