Don't Waste Your Money: Secret tax hike to come in January
By John Matarese| November 7, 2012 at 7:07 PM EST - Updated June 28 at 12:04 PM
(Toledo News Now) - The presidential race is finally over, but there is some bad news the candidates didn't want to bring up before Election Day.
When it comes to the taxes we pay, President Obama's re-election will have no impact at all on the biggest tax hike that most Americans will see next year. That's because both Democrats and Republicans in Congress appear willing to sit back and let this tax hit Jan. 1. This has nothing to do with the upcoming "fiscal cliff," that Congress will try to resolve before the end of the year.
All Workers To Get Hit
It doesn't matter if you work on cars for a living, work in a grocery store, or have an office job. Get ready for less money in your first January paycheck.
A secret tax hike is coming with a temporary 2 percent tax break ending.
Most people don't realize it, but for the past two years, workers have gotten a break in Social Security taxes to help boost the economy.
But with Social Security on the ropes, most members of Congress - in both parties - are willing to let that temporary cut expire. It will happen under a second Obama presidency, and would have happened under a Romney one, as well.
Doesn't That Stink?
So from the "doesn't that stink" file comes the unpleasant surprise many workers will see in two months. How bad will the hit be?
If you earn $50,000 a year, your payroll taxes will rise about $1,000 next year. So your typical two-week paycheck will be $40 less.
It really stinks if your family earns $100,000. Your taxes go up $2,000 next year.
Still a Slight Chance
There's always a chance of a last-minute deal. But it looks doubtful because it's really just restoring the tax rate to where it was two years ago.