During 2010, LFC provided a paycheck analysis if the Bush tax laws had expired on 12/31/10 as they were set to do. However, the law was extended for two years just before the year ended.
We are now faced with the same scenario on 12/31/12. Therefore, LFC has provided a similar analysis using the 2012 tax table to determine what impact there will be if the law expires in December and is not extended or made permanent. The immediate impact will be felt in January of 2013 beginning with the first payroll check received by employees. Self-employed individuals will feel the impact when they make their estimated tax payments in 2013.
What is different this time is that we are in the midst of a presidential election. The results of the election will have an impact as to whether these laws (the 2001 & 2003 Bush tax laws) are renewed.
The economic impact on the nation could be significant because this represents a large tax increase at a time when the economy is so fragile. Not only will the tax rates rise, but other provisions of the law (most significantly, the child tax credit of $1000) will go away as well.
LFC will keep you posted on future developments.
Here is the current analysis: Link
If you have questions, feel free to contact LFC. info@lfconinc.com
