Chalk up another whopper of a lie. If misleading the American public last year about the supposed $400 tax cut that turned out to be a tax credit, Obama’s budget includes increases in taxes on the lower and middle class. The Obama administration is set to let the Bush tax cuts expire without extending them- this will be another “blame Bush”.
If the provisions are allowed to expire on December 31, the top-tier personal income tax rate will rise to 39.6 percent from 35 percent. But lower-income families will pay more as well: the 25 percent tax bracket will revert back to 28 percent; the 28 percent bracket will increase to 31 percent; and the 33 percent bracket will increase to 36 percent. The special 10 percent bracket is eliminated.
Investors will pay more on their earnings next year as well, with the tax on dividends jumping to 39.6 percent from 15 percent and the capital-gains tax increasing to 20 percent from 15 percent. The estate tax is eliminated this year, but it will return in 2011 — though there has been talk about reinstating the death tax sooner.
Millions of middle-class households already may be facing higher taxes in 2010 because Congress has failed to extend tax breaks that expired on January 1, most notably a “patch” that limited the impact of the alternative minimum tax. The AMT, initially designed to prevent the very rich from avoiding income taxes, was never indexed for inflation. Now the tax is affecting millions of middle-income households, but lawmakers have been reluctant to repeal it because it has become a key source of revenue.
Without annual legislation to renew the patch this year, the AMT could affect an estimated 25 million taxpayers with incomes as low as $33,750 (or $45,000 for joint filers). Even if the patch is extended to last year’s levels, the tax will hit American families that can hardly be considered wealthy — the AMT exemption for 2009 was $46,700 for singles and $70,950 for married couples filing jointly.
Middle-class families also will find fewer tax breaks available to them in 2010 if other popular tax provisions are allowed to expire.
Among them:
* Taxpayers who itemize will lose the option to deduct state sales-tax payments instead of state and local income taxes;
* The $250 teacher tax credit for classroom supplies;
* The tax deduction for up to $4,000 of college tuition and expenses;
* Individuals who don’t itemize will no longer be able to increase their standard deduction by up to $1,000 for property taxes paid;
* The first $2,400 of unemployment benefits are taxable, in 2009 that amount was tax-free.
Write this one down. I predict that Obama and Democrats will work on a strategy that allows Obama to navigate his way out of the decision to try terrorist in civilian courts. I imagine that that strategy will have Congress pulling funding for trying terrorist in civilian court and “forcing” Obama to move the trials to military courts.
Canadian Premier Danny Williams will undergo heart surgery later this week in the United States. A spokesperson for the Premier said, “It was never an option offered to him to have this procedure done in this province,” refusing to answer whether the procedure could be done elsewhere in Canada. Which leaves this blogger confused… I thought we were told by the Progressive Left that Canada had a superior health-care system.
Decorum was handed a backseat at the Grammy’s on Sunday. No, Adam Lambert didn’t perform. This years techy-themed Grammy gift bag contained something called the “OhMiBod” – it’s a vibrator that plugs into your iPod and works to the music of your favorite song. Such a thoughtful gift from the Grammy committee. I’m sure 20 year old Taylor Swift couldn’t wait to show her father her Grammy and OhMiBod.
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