How the Fiscal Cliff Would Hit Your Wallet
Posted at 12:45 p.m. on Nov. 21, 2012
The Wall Street Journal digs into numbers from the Tax Policy Center that show how the “fiscal cliff” spending cuts and tax hikes would impact various income groups.
“A married couple making between $20,000 and $30,000 a year would go from receiving, on average, a $15 tax credit to owing $1,408… And most households—121 million in all—would be hit by an increase in the payroll tax that employees pay to 6.2% from 4.2%.”
“Middle-income households would be affected particularly by the higher income-tax rates, the loss of marriage-penalty relief and the reduced child credit. A family with $40,000 to $65,000 in annual income would pay an additional $2,000 in taxes on average, the Tax Policy Center estimates.”
“High-income taxpayers, including many small-business owners, would be hurt by the higher individual income-tax rates plus higher rates on dividends, capital gains and other types of investment income. A household earning between $200,000 and $500,000 a year would see an average tax increase of about $15,000.”