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The Bush tax cuts are about to expire. What I have heard is that the expiring tax cuts will only affect the rich! Some of the goodies that will expire will hurt us all.

First, about 50% of us don't even pay income taxes. Either we don't make enough to owe taxes or we claim so many deductions and credits it eliminates our tax bill. That only means that someone else picks up our tab.

At midnight, Dec. 31, those who pay will owe even more. The lowest income earners tax responsibility raises from 10% to 15%. For our lucky wealthier neighbors, the tax rate climbs to 40% from 35%.

Here's the probable cost to you. The typical family earning more than $50,000 would see their federal tax burden rise by more than $2,900, according to Deloitte Tax LLP. Our wealthy married neighbor earning $100,000 will owe an additional $4,500.

The $1,000 per child tax credit we have enjoyed will be cut in half. The interest deductions on our college loans will fall as well. As a bonus, we will be allowed to set aside less for our child's education in an education IRA.

But there's still more that will affect us all. The marriage penalty will return. The estate tax returns to 55%. Taxes on dividends will reset up to 39.6% from 15% and long-term capital gains will rise to 20% from 15%, effectively hurting our retired neighbors.

There is a lot at stake for us all.

Jan Skjolsvik

Fifty Lakes, MN[[In-content Ad]]

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