The House of Representatives late Tuesday easily approved emergency bipartisan legislation sparing all but a sliver of America’s richest from sharp income tax hikes — while setting up another “fiscal cliff” confrontation in a matter of weeks.
The compromise bill averts the sharpest tax increase in American history. But it hikes rates on income above $400,000 for individuals and $450,000 for households, while exemptions and deductions the wealthiest Americans use to reduce their tax bill face new limits. The accord also raises the taxes paid on large inheritances from 35% to 40% for estates over $5 million. And it extends by one year unemployment benefits for some two million Americans. It also prevents cuts in payments to doctors who treat Medicare patients and spares tens of millions of Americans who otherwise would have been hit with the Alternative Minimum Tax. And it extends some stimulus-era tax breaks championed by progressives.
The middle class will still see its taxes go up: The final deal did not include an extension of the payroll tax holiday. For full report go to House passes fiscal cliff deal, tamps down GOP revolt