Payroll Tax Cut Extension Signed
By: Hope Wilkos, Writer/Blogger
Photo: Getty Images
As the last of the holiday gifts are opened and we look back at how much we spent on gifts during the holiday season, consumers can rest assured for now that the payroll tax cut has been extended another two months. There were some uncomfortable moments as stalemates ensued on both sides but an agreement was reached prior to breaking for the holidays.
This $33 billion bill also includes a 2-month extension of emergency federal unemployment benefits and a “doc-fix” which is a delay in scheduled payment reductions to doctors treating Medicare patients.
It is a win win situation for not only the middle-class American but also for the Democratic Party as well.
Obama also signed an appropriations bill funding government through September 2012, an issue that has seemed to be creating ongoing problems and uncertainty in the economy up to this point.
The payroll tax cut will stay at 4.2% instead of the previous 6.2%. If this bill had not been extended, the middle-class citizen would have had an approximate $1,000 tax increase. This equates to a reduction of $40 take home per pay period. This is a significant dollar amount.
Obama also wants to make sure that those out there seeking work don’t begin to lose their unemployment insurance on January 1st.
Congress will consider continuing the extension for a longer period of time when it reconvenes in January.
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