Monday, December 06, 2010

Report: General Agreement on Taxes for next two years

by Bill McBride on 12/06/2010 08:29:00 PM

The NY Times has the details: Pact on Bush Tax Cuts Trims Payroll Levy

A few points:
• Extend Bush income tax cuts for two years, including for high income earners.

• 13-month extension of jobless aid for the long-term unemployed. This isn't additional weeks of benefits for the '99ers - this is an extension of the qualification dates for existing tiers of extended unemployment benefits.

• Reducing the Social Security payroll tax by two percentage points for a year:

For a family earning $50,000, the two percentage point cut would mean a savings of $1,000.

For workers paying the maximum, the two percentage point cut would mean a savings of $2,136.
• Estate tax exemption of $5 million per person and a maximum rate of 35 percent.

This is expected to increase the budget deficit by $900 billion over two years.