Tax Cut Showdown

Showdown over tax cuts:

Average family will pay $1,600 more in taxes next year

No one in Congress is budging on the January expiration of tax cuts and the result means 114 million families will see average tax increases of $1,600 next year. And the blame should be on:


You choose:

The Republicans
The Democrats
Both Democrats and Republicans.

(I am guessing in a poll, it would be 33% for each choice-or maybe higher for both!!).

Do you care? You should if you are a taxpayer. IF the Bush Era tax cuts expire, you WILL be paying more taxes definitely. According to a White House report, the average will be $1600 for 2013.

The $1,600 average tax increase is for all families earning under $250,000, White House officials said. The numbers of families from this group would range from 13.2 million in California to 200,000 in Wyoming, the report said. For Ohio, it is estimated that 4.3 million families will be hit with the average $1600 increase.

The exact size of a family’s tax cut would depend on its size, income and other characteristics.

A married couples earning $50,000 to $80,000 with two children would see a tax increase of $2,200, the paper said. A childless couple making $200,000, including $20,000 of capital gains income, would see their tax bill grow by $5,540.

The report did not include a figure showing the average tax increases that wealthier earners would face, but they would be substantially higher.

The bottom line is that if nothing is done, you will be paying more if you are a working taxpayer. Will something be done? No one knows, but both sides seem to agree that a tax increase is wrong with the economy being as slow as it is. The disagreement is how it should be done. The problem is that nothing will probably be done until after the election or into the next Congress in January.

References:
Ohio Society of CPAs. August 1 2012. Showdown over tax cuts… http://www.ohioscpa.com/publications/news/2012/08/01/showdown-over-tax-cuts-average-family-will-pay-$1-600-more-in-taxes-next-year?utm_source=TAX&utm_medium=email&utm_campaign=TAX&mppid=133230

The President’s Proposal to Extend the Middle Class Tax Cuts. July 2012. http://www.whitehouse.gov/sites/default/files/uploads/middleclassreport_7_24_2012.pdf