In just six months, the largest tax hikes in the history of America will take effect. They will hit families and small businesses January 1, 2011, says Americans for Tax Reform.
The first wave will be the expiration of 2001 and 2003 Tax Relief. In 2001 and 2003, the GOP Congress enacted several tax cuts for investors, small business owners, and families. These will expire on January 1, 2011.
- Personal Income tax rates will rise; the top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed).
- The lowest rate will rise from 10 to 15 percent; all the rates in between will also rise.
- Itemized deductions and personal exemptions will again phase out, which has the same mathematical effect as higher marginal tax rates.
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