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Tags: Bush | Tax | Cuts | Cost

How Much Will Bush Tax Cuts Cost? A Lot

Tuesday, 03 August 2010 09:44 AM EDT

The Tax Foundation has released a report showing how the expiration of the Bush-era tax cuts would affect the average middle-income family in each state and congressional district.

The report looks at the average family in the middle 20 percent of the income spectrum and compares their 2011 federal income tax liability if all the tax cuts expire to their tax bill if all the tax cuts are extended.

Nationally, the typical middle-income family, which has a median income of $63,366, would see its federal income tax burden increase by $1,540 if the Bush-era tax cuts expire.

“The impact of the expiration or extension of the Bush-era tax cuts on families varies according to myriad factors such as income level, sources of income, marital status, number of children and housing status,” Tax Foundation President Scott Hodge said. “Family circumstances differ significantly across geographic regions as well.”

For example, the more children a family has, the more its taxes will increase because the child tax credit will drop from $1,000 per dependent child to $500. Married families will be affected differently than single families due to the so-called marriage penalty provisions that are scheduled to return if the tax cuts are not extended.

The average-middle income family in Alaska, which has a median income of $79,541, would pay nearly $2,000 more in federal income taxes in 2011 if the tax cuts expire. By contrast, the typical family in West Virginia, with a median income of $49,082, would pay about $1,300 more. The differences are great among the hundreds of congressional districts as well.

To see how the expiration of the Bush-era tax cuts would affect a specific taxpayer, visit the Tax Foundation’s interactive calculator.

To access the calculator, Go Here Now.

The calculator allows taxpayers to compare their 2011 federal income tax liabilities under three scenarios: if all the tax cuts expire completely at the end of this year, if they’re all extended into 2011 or made permanent, and if President Obama’s budget is adopted, which includes a combination of expirations and extensions.

The Tax Foundation is a nonpartisan, nonprofit organization that has monitored fiscal policy at the federal, state and local levels since 1937.

© All Rights Reserved.


InsideCover
The Tax Foundation has released a report showing how the expiration of the Bush-era tax cuts would affect the average middle-income family in each state and congressional district. The report looks at the average family in the middle 20 percent of the income spectrum and...
Bush,Tax,Cuts,Cost
365
2010-44-03
Tuesday, 03 August 2010 09:44 AM
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