.

Falling Off the Cliff Means Sky-High Taxes for Most

The new report estimates that all in all, 9 in 10 Americans would see their taxes go up if we go over the fiscal cliff.

9 in 10: Americans projected to pay higher taxes post-fiscal cliff

The U.S. elections are over and we are reminded that they come against the backdrop of expiring tax cuts and potential spending reductions, also known as the fiscal cliff. If Congress does not act by January and we go over the fiscal cliff, taxes will increase for the 160 million Americans on payrolls, according to a recent report by the Tax Policy Center. The average household could pay $3,500 more in federal taxes, while the average household in the top 1% could pay $120,000 more. The federal tax rate for households in the top one-percent will climb 7% while households in the bottom income quintile will experience a  .7% increase; demonstrating that although the wealthy American population might be most significantly affected by this tax increase, underprivileged Americans will certainly still feel the impact on their wallets. The new report estimates that all in all, 9 in 10 Americans would see their taxes go up if we go over the fiscal cliff. Investors should view this as yet another reason to invest their cash, so that it has the ability to grow over time rather than be diminished by possibly sky-high tax rates.

Sources: BlackRock; Tax Policy Center; The New York Times: "The Tax Side of the
Fiscal Cliff," 10/1/2012

http://www2.blackrock.com/

Prepared by BlackRock

Delivered courtesy Joel W. Grams, CRPC®, CLTC,

Registered Representative, Financial Planner, 212 Capital Group

38 Main Street Suite 360, Westlake Ohio 44145

(440) 835-4501 Ext 17, jgrams@212capitalgroup.com

The foregoing discussion is general in nature and not intended as specific advice.
New England Financial nor its representatives are engaged in rendering tax,
accounting or legal advice. A qualified professional should be consulted regarding the effect of such considerations on the matters covered in this publication.

For information on New England Financial insurance or other financial products and services, please contact Joel W. Grams, CRPC®, CLTC, Registered Representative, Financial Planner with /New England  Financial 38 Main Street Suite 360, Westlake, OH 44145, at (440) 835-4501 ext. 17, jgrams@212capitalgroup.com

www.212capitalgroup.com 

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

lyn November 12, 2012 at 10:26 PM
Dinner! Later Murphy!
Murphy-Solon November 12, 2012 at 10:28 PM
Sure we could have dinner later. Oh, you meant dinner.............later Murphy o.k.
lyn November 13, 2012 at 06:50 PM
To just add to yesterday's comment while I have a minute... AND, its not just the poor who gets these credits. I don't think people realize just how much the government gives back to those they now determine to be needy. There's all kinds of credits - child tax credit (up to $3000), earned income tax credit (up to $5891),... As we have said, it is redistribution - for people to get these credits, actual money back, other people have to be paying more in taxes. This info below is from the IRS site.
lyn November 13, 2012 at 06:52 PM
Preview of 2012 Tax Year Earned Income and adjusted gross income (AGI) must each be less than: $45,060 ($50,270 married filing jointly) with three or more qualifying children $41,952 ($47,162 married filing jointly) with two qualifying children $36,920 ($42,130 married filing jointly) with one qualifying child $13,980 ($19,190 married filing jointly) with no qualifying children Tax Year 2012 maximum credit: $5,891 with three or more qualifying children $5,236 with two qualifying children $3,169 with one qualifying child $475 with no qualifying children
lyn November 13, 2012 at 06:56 PM
I have no problem with an exemption for each child, but this continual additional passing out of monies to people because they have kids or are at a certain income level is just not right. Don't take my income taxes and give them to other people - especially if they owe no taxes to begin with. This is just another form of welfare.

Boards

More »
Got a question? Something on your mind? Talk to your community, directly.
Note Article
Just a short thought to get the word out quickly about anything in your neighborhood.
Share something with your neighbors.What's on your mind?What's on your mind?Make an announcement, speak your mind, or sell somethingPost something
See more »