Explaining the 'fiscal cliff' (audio)
WASHINGTON (AP) — A new study is detailing how taxpayers across the income spectrum would face whopping tax hikes next year if Washington fails to renew a lengthy roster of tax cuts set to expire in December.
A typical middle-income family would see its taxes go up by $2,000 says the report from the Tax Policy Center, a joint effort of two Washington think tanks.
Households in the top 1 percent income range would see an average tax increase of more than $120,000, while a family making between $110,000 and $140,000 could see a tax hike in the $6,000 range.
The expiring provisions include Bush-era cuts on income and investments and for married couples and families with children, among others. Also expiring is a 2 percentage point temporary payroll tax cut.
Paul Wazzan, Director at the Berkeley Research Group, explains what the fiscal cliff is in this conversation with Maggie McKay and Michael Shappee: