Tax Policy Center's 2001/2003 Tax Cut Calculator
The Tax Policy Center recently unveiled their new “Tax Calculator,” which examines how the decisions regarding the 2001/2003 tax cuts will affect people’s tax payments. The Tax Calculator allows you to calculate the impact of three distinct scenarios on your bottom line: current policy where all of the 2001/2003 tax cuts are in place; current law where they all expire; and having the tax cuts continued except for individuals making over $200,000 or couples making over $250,000 (the plan outlined in President Obama’s 2011 budget).
Their calculator has six sample taxpayer options: married and under age 65 with no children, married with one child in college, married with two children under 13, single, head of household with two children under age 13 and married and over 65. The calculator spits out a host of tax metrics on your different assumptions about income and other houshold variables. It's really cool. Year, we said it - a tax calculator is really cool.
Using the Tax Calculator and their pre-determined “Middle Income” bracket, the following results were produced:
|Married, Under 65, No Children||Married, 1 Child in College||Married, 2 Children Under Age 13||Single||Head of Household, 2 Children Under Age 13||Married, 65 and Over|
|Current Tax Law (with all 2001/2003 Tax Cuts)||No Change||No Change||No Change||No Change||No Change||No Change|
|All 2001/2003 Tax Cuts Expire||$1,944 Higher||$2,138 Higher||$2,638 Higher||$819 Higher||$2,400 Higher||$852 Higher|
|President Obama's Plan||$160 Lower||No Change||$645 Lower||No Change||No Change||No Change|
However, it should be noted that this calculator does not take into account the resulting fiscal costs that President Obama’s plan or a full extension would entail. The following table details the budgetary impact of these options (as we detailed in a previous blog):
||2011-2020 Budgetary Impact|
|Fully Extend Tax Cuts (without AMT)||$2.7 Trillion|
|Fully Extend Tax Cuts (with AMT)||$3.9 Trillion|
|Extend the Tax Cuts for All but Top Earners (without AMT)||$1.7 Trillion|
|Extend the Tax Cuts for All but Top Earners (with AMT)||$3.0 Trillion|
Click here for our Budget Simulator to see how these tax cuts, and a wide variety of other budget alternatives, can be used to help bring our long-term fiscal house in order.