AP: Early Tuesday morning the US Senate passed a deal to avert the ‘fiscal cliff.’ The legislation will now move to the House of Representatives where a vote is expected before Wednesday.
The White House-backed deal raises taxes on incomes of more than $400,000 for individuals and on incomes of more than $450,000 for couples. The measure also temporarily blocks spending cuts for two months.
Who wants to bet the House finds a way to screw this up?
Senate Democratic aide: White House and GOP reach deal on fiscal cliff.
Some details on the deal, from CBS:
Tax rates: current tax rates will be extended for all wage earners making below $400,000 and couples making below $450,000. This was a key concession for both Republicans and Democrats. Democrats wanted the threshold for tax increases to rest at $250,000 and Republicans didn’t want marginal tax rates to increase for anyone.
The estate tax: it was set to increase from rom 35 percent to 55 percent in 2013. Instead, the compromise sets the new rate at 40 percent with the first $5 million worth of property exempt from being taxed.
Capital gains tax: Capital gains and dividend tax rates will increase from 15 to 20 percent.
Alternative Minimum Tax: a permanent fix to the tax that would hit middle class families “Doc Fix”: doctors will be shielded from a massive reimbursement gap for treating Medicare patients.
Unemployment benefits: unemployed workers will receive their benefits which expired over the weekend.
Renewable energy tax credit: the tax credit for renewable energy companies will be extended for another year.
The deal involves a little bit of kicking the can down the road: Sequestration will be held off for two months. Which means that, for the first time ever, an odd-numbered year may be a leap year, as the deal would expire at the end of February.
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