What We Know So Far About the "Fiscal Cliff" Deal: Part 1 of 3 on the Fiscal Cliff
As many of you have heard, the "fiscal cliff" has been averted following House passage of a Senate bill to prevent large cuts in spending and large tax increases. Details of the bill are still emerging, but here is what we have seen so far: Income Tax Rates : Income tax rates will increase for single workers earning more than $400,000 and families earning more than $450,000. Income tax rates in this bill will be considered "permanent," as opposed to the Bush tax cuts of 2001, which were considered temporary. Payroll Taxes : Payroll taxes will increase for workers at all incomes, with the Social Security tax returning to 6.2% on a worker's first $113,700 in wages. This tax was temporarily set at 4.2% two years ago. For a worker earning the national average of $41,000, this increase comes to about $32 more per biweekly paycheck. ( Here is our Facebook post describing payroll taxes .) Tax Credits : There will be a five year extension of the tax credits...