What Happens When Bush’s Tax Cuts Expire?

All sorts of bad things can occur unless the Obama administration extends the roll-back. Not likely.

If you’re an investor, being in a lower tax bracket won’t save you from upcoming tax hikes, no matter what the Obama administration says. Anyone who owns even a few shares in a mutual fund or collects a pension will feel the effects of rising taxes.

Why? At the end of this year, the Obama White House plans to let many Bush administration tax cuts expire resulting in a 4.5% hike in income tax rates, the elimination of the 10% tax bracket, a cut in standard deductions for married taxpayers, and a sharp increase in the estate tax. This will adversely affect many Americans and most likely have a negative impact on the overall economy as well.

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