TheJOTUS

The Jim of the United States

What Happens When The Bush Tax Cuts Expire?

Posted by TheJOTUS on August 22, 2010

Basically everyone will have their taxes increase.  And married couples and families will be the hardest hit:

Taxes will soar in a number of critical areas, read below to see just how our bloated government plans to take more and more from all of us:

First Wave: Expiration of 2001 and 2003 Tax Relief

In 2001 and 2003, Congress enacted several tax cuts for investors, small business owners, and families. These are all currently set to expire on January 1, 2011:

Personal income tax rates will rise. The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed). The lowest rate will rise from 10 to 15 percent. All the rates in between will also rise. Itemized deductions and personal exemptions will again phase out, which has the same mathematical effect as higher marginal tax rates. The full list of marginal rate hikes is below:

– The 10% bracket rises to an expanded 15%
– The 25% bracket rises to 28%
– The 28% bracket rises to 31%
– The 33% bracket rises to 36%
– The 35% bracket rises to 39.6%

This will affect people of all income levels!

Higher taxes on marriage and family. The “marriage penalty” (narrower tax brackets for married couples) will return from the first dollar of income. The child tax credit will be cut in half from $1000 to $500 per child. The standard deduction will no longer be doubled for married couples relative to the single level. The dependent care and adoption tax credits will be cut. This will affect all people who are married and/or have children.

It was the democrats in both 2001 and 2003, that allowed those bills cutting the tax rates require hard-and-fast provisions creating an expiration date without any other action. We are now just a few short months away from that expiration date after seven years of seeing it coming.   Including more than 3 years of democratic control of Congress and almost 2 years of President 3 iron’s administration.

If nothing is done soon, then we are going to see the ‘murican people burdened with a nearly $4 trillion tax hike.

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