How Would the Expiration of the Bush-Era Tax Cuts Affect Individual Taxpayers
NEW CALCULATOR SHOWS HOW MUCH YOU COULD OWE WHEN THE TAX CUTS EXPIRE
The Tax Foundation has launched a Bush-era tax cuts calculator at www.MyTaxBurden.org, which allows taxpayers to compare their 2011 federal income tax liabilities under three scenarios: if all the Bush-era 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.
Taxpayers can type in basic information-such as filing status, wage income and number of dependents-along with optional more detailed information-such as capital gains and dividend income, state and local taxes paid and other itemized deductions-and determine what their federal income tax burden would be in 2011.
“The fate of the 2001 and 2003 tax cuts remains uncertain, and congressional leaders seem poised to leave things that way through the August recess-and perhaps through the November elections,” said Tax Foundation President Scott Hodge. “Regardless of what happens, our tax calculator at MyTaxBurden.org can help give taxpayers a better sense of how these policies will affect them-whether all the Bush-era tax cuts are extended or just those affecting families earning less than $250,000 a year, or if all the tax cuts expire.”
The calculator also allows for more detailed tax information. For example, consider a married couple making $500,000 with two children; long-term capital gains of $50,000; dividend income of $5,000; other income of $10,000; a state and local income tax deduction of $30,000; $10,000 in real estate taxes paid; and $40,000 in other itemized deductions. Their federal income tax bill would be $22,782 higher in 2011 if all the Bush-era tax cuts expire.
Click on the image above or go to www.MyTaxBurden.org to start using the calculator. Or, to learn more about the calculator first: