Today, the Tax Foundation posted a “Bush Tax Cuts” calculator to show how the expiration of Bush's tax cuts would hit individual taxpayers. The calculator can be found on www.MyTaxBurden.org and it allows taxpayers to compare 2011 income tax liability if Bush tax cuts expire or are extended.
Here is the post from the Tax Foundation today:
Washington, DC, July 23, 2010 - The Tax Foundation has launched a "Bush tax cuts" calculator at www.MyTaxBurden.org, which allows taxpayers to compare their 2011 federal income tax liabilities under three scenarios: if all the Bush tax cuts expire completely at the end of this year, if they're all extended into 2011 or made permanent, and if President Obama's budget is adopted, which includes a combination of expirations and extensions.
Taxpayers can type in basic information—such as filing status, wage income and number of dependents—along with optional more detailed information—such as capital gains and dividend income, state and local taxes paid and other itemized deductions—and determine what their federal income tax burden would be in 2011.
"The fate of the 2001 and 2003 tax cuts remains uncertain, and congressional leaders seem poised to leave things that way through the August recess—and perhaps through the November elections," said Tax Foundation President Scott Hodge. "Regardless of what happens, our tax calculator at MyTaxBurden.org can help give taxpayers a better sense of how these policies will affect them—whether all the Bush tax cuts are extended or just those affecting families earning less than $250,000 a year, or if all the tax cuts expire."
For example, if Congress fails to act to extend the Bush tax cuts, the federal income tax burden for a married couple filing jointly making $80,000 with two children would be $2,137 higher in 2011 than if all the tax cuts were extended.
The calculator also allows for more detailed tax information. For example, consider a married couple making $500,000 with two children; long-term capital gains of $50,000; dividend income of $5,000; other income of $10,000; a state and local income tax deduction of $30,000; $10,000 in real estate taxes paid; and $40,000 in other itemized deductions. Their federal income tax bill would be $22,782 higher in 2011 if all the Bush tax cuts expire.
On the calculator page, fields left blank will automatically be counted as zero. Users may hover the mouse cursor over an item to get a more detailed description of each field. For more information, see a short video explanation of how the calculator works.
The calculator at www.MyTaxBurden.org is part of a series answering frequently asked questions about the expiration of the Bush tax cuts, available online at http://www.taxfoundation.org/publications/show/26135.html.
The Tax Foundation is a nonpartisan, nonprofit organization that has monitored fiscal policy at the federal, state and local levels since 1937.