PSA: Projected paycheck hit due to tax cut expiration in 2011

[The Sound Guy]

I read this and found it interesting. They have an estimate of how much our withholding will jump on the first check in January 2011 if Congress and the President let the tax cuts expire. They also note that we could end up paying extra for a month or so in 2011 because of the time it takes to get the tax tables updated and entered into the various payroll systems even if the extension is passed, but not until Nov 15th or later.

 

I dunno about the rest of you, but even saving $300 or so in county taxes a year is chicken feed compared to an increase of $200-$300 a month in federal taxes. There is not that much "fat" in my budget, danged if I know what I'd cut to try to make up for it.

 

Just make sure you are ready.

 

PS. I didn't put this in the political forum because this increase will hit all of us, and I wasn't aware of just how big a hit they were talking about. I'd rather this stay non-political, but if it doesn't, Mods, feel free to move.

 

Wall Street Journal

 

Lack of congressional action on 2011 income taxes may force the Treasury Department to make unprecedented moves to prevent U.S. workers from seeing large tax increases in their January paychecks.

 

The issue: 2011 tax-withholding tables. Treasury officials usually release the tables, which determine the take-home pay of millions of wage-earners, by mid-November because it takes payroll processors weeks to adjust their systems before Jan. 1. But congressional leaders recently postponed voting on taxes until after the election and lawmakers don't reconvene until Nov. 15. The Senate is scheduled to take up several nontax issues when it returns and is expected to leave for Thanksgiving soon after, possibly pushing a vote on taxes into December.

 

"Things get very dicey after the first of December" because of employers' need to know the 2011 rates, said Michael Graetz of Columbia University Law School, a former Treasury official.

 

What your hit could be (per month):

 

 

Treasury officials' most obvious option is the least attractive. If they publish tables based on expiration of the Bush tax cuts, which occurs Jan. 1, millions of low- and middle-income taxpayers who have paid little or no income taxes for a decade would likely see increases in January. Prof. Graetz estimates that higher withholding could take up to $10 billion a month out workers' pockets due to higher tax rates alone. Other benefits also are expiring.

 

Hmmm... Take 10 billion out of the economy, that will help stop this recovery.

[Sugail]

Like I said in another thread, no one has good news. No wonder I'm feeling depressed.

[FreeBird]

dang it - I thought congress said they were just going to stick it to the "rich folks."

[dapandlap]

I read this and found it interesting. They have an estimate of how much our withholding will jump on the first check in January 2011 if Congress and the President let the tax cuts expire. They also note that we could end up paying extra for a month or so in 2011 because of the time it takes to get the tax tables updated and entered into the various payroll systems even if the extension is passed, but not until Nov 15th or later.

 

I dunno about the rest of you, but even saving $300 or so in county taxes a year is chicken feed compared to an increase of $200-$300 a month in federal taxes. There is not that much "fat" in my budget, danged if I know what I'd cut to try to make up for it.

 

Just make sure you are ready.

 

PS. I didn't put this in the political forum because this increase will hit all of us, and I wasn't aware of just how big a hit they were talking about. I'd rather this stay non-political, but if it doesn't, Mods, feel free to move.

 

Wall Street Journal

 

 

 

What your hit could be (per month):

 

 

 

 

Hmmm... Take 10 billion out of the economy, that will help stop this recovery.

 

Am I reading the chart correctly that people with children will see a larger tax increase than people without?

[FreeBird]

those with children got more of their money under the current tax plan - so everyone goes back as even - a dollar is a dollar as opposed to a dollar going to a family with kids.

 

This will be the best thing the demorats could do to hang their selves even further.

[Guest Hi~ho Silver]

We have the most dysfunctional Congress in history. I don't expect any action, and plan on the tax cuts expiring. I figure it will be about 300 extra a month for most folks. You have to start thinking like a progressive thinks. They never had any intention of extending the tax cuts.

[The Sound Guy]

Am I reading the chart correctly that people with children will see a larger tax increase than people without?

 

Yes, one of the big hits is that the Child Tax Credit, that started at $250 a child and was grown to $1000 a child, will go back to $500 in 2011.

 

So if you have 2 kids under 16, you taxes will go up 2x$500 or $1000 a year. If you have 3 kids under 16, make that $1500 a year.

[dapandlap]

Yes, one of the big hits is that the Child Tax Credit, that started at $250 a child and was grown to $1000 a child, will go back to $500 in 2011.

 

So if you have 2 kids under 16, you taxes will go up 2x$500 or $1000 a year. If you have 3 kids under 16, make that $1500 a year.

How FREAKING STUPID are the idiots in Washington?, this will surely help the economy.

What was 0bamas promise all during his campaign, " no tax increases on 95% of American families"

I want my bumper sticker now

0bama LIED

Edited October 8, 2010 by dapandlap

[shortnsassy]

I think we all are going to end up homeless before it is over with. Going to Walmart and check out tent prices before inflation hits them due to supply and demand. Our health insurance went up in January from $52.00 to $172.00 bi-weekly, then in July from $172.00 to $288.00 bi-weekly. Our homeowners insurance is up $100.00 per yr. Thank God our property taxes went down $120.00. Not sure where we can keep adjusting.

[politicalmonster]

Wonder where all the Obama supporters are? shouldn't they be here telling us how the stimulus packages we got stuck with in the past year are making things better? Or how Obama isn't going to raise our taxes? Or how things were so much worse under Bush and the Republicans?

 

I really wanted to give Obmama the benefit of the doubt when he got elected, but unfortunately, he is turning out exactly as I feared. This whole "evil rich" and "evil businesses" thing is so dang stupid. The rich and the businesses are what drive the freakin economy! So what if the the CEO makes 9000 times what we do? If he is running a profitable company that is employing 1000s of people, he is doing more to stimulate the economy than ANY politician!!

 

And so what if the gap between the richest and the poorest is widening?? You know how to make that even worse? Tax the crap out of the richest so that they protect more of their money instead of investing it in ventures that employ people!!

If you raise taxes on the rich, they will just find ways to shelter more of their money. That is why they are rich, because they know how to make and save money!!!

 

Ok. I feel better.

 

-PM

[dapandlap]

Wonder where all the Obama supporters are? shouldn't they be here telling us how the stimulus packages we got stuck with in the past year are making things better? Or how Obama isn't going to raise our taxes? Or how things were so much worse under Bush and the Republicans?

 

I really wanted to give Obmama the benefit of the doubt when he got elected, but unfortunately, he is turning out exactly as I feared. This whole "evil rich" and "evil businesses" thing is so dang stupid. The rich and the businesses are what drive the freakin economy! So what if the the CEO makes 9000 times what we do? If he is running a profitable company that is employing 1000s of people, he is doing more to stimulate the economy than ANY politician!!

 

And so what if the gap between the richest and the poorest is widening?? You know how to make that even worse? Tax the crap out of the richest so that they protect more of their money instead of investing it in ventures that employ people!!

If you raise taxes on the rich, they will just find ways to shelter more of their money. That is why they are rich, because they know how to make and save money!!!

 

Ok. I feel better.

 

-PM

 

Agreed 100%

[AcworthDad]

dang it - I thought congress said they were just going to stick it to the "rich folks."

 

The Democrats definition of "rich":

 

"If you pay federal taxes, you are rich."

 

Wonder where all the Obama supporters are? shouldn't they be here telling us how the stimulus packages we got stuck with in the past year are making things better? Or how Obama isn't going to raise our taxes? Or how things were so much worse under Bush and the Republicans?

 

I really wanted to give Obmama the benefit of the doubt when he got elected, but unfortunately, he is turning out exactly as I feared. This whole "evil rich" and "evil businesses" thing is so dang stupid. The rich and the businesses are what drive the freakin economy! So what if the the CEO makes 9000 times what we do? If he is running a profitable company that is employing 1000s of people, he is doing more to stimulate the economy than ANY politician!!

 

And so what if the gap between the richest and the poorest is widening?? You know how to make that even worse? Tax the crap out of the richest so that they protect more of their money instead of investing it in ventures that employ people!!

If you raise taxes on the rich, they will just find ways to shelter more of their money. That is why they are rich, because they know how to make and save money!!!

 

Ok. I feel better.

 

-PM

 

Well said!!

[shortnsassy]

Agreed 100%

ME TOO!!!!!!