If lawmakers fail to act before January 1, 2013 and address the pending “fiscal cliff”, $7 trillion worth of tax increases and spending cuts go into effect. Check out the attached summary to see how you might be impacted.
If you are like most people, you probably are getting tired of hearing about the so-called fiscal cliff. At its core, this issue is about government spending and tax revenue. Most citizens, unlike many of our elected officials, understand that our current spending levels are unsustainable. This is largely because our entitled programs, which make up the majority of government spending, are broken. Simply, they are projected to pay out more than they are taking in. Legislators in Washington – at least the ones who believe the programs are broken – cannot agree on how to fix these programs. The others are just willing to pass the problem along to future generations.
But what about the revenue side of the equation? Some feel that raising taxes particularly on the rich can solve the problem. This is another point of contention. Any discussion of raising taxes should start with some basic understanding of taxes and rates. Following is a link to a video that offers a very good explanation of this topic. You may find this helpful as you filter the news about the ongoing fiscal cliff brinkmanship in Washington D.C. http://www.youtube.com/watch?v=ayad5mbSSrU