“The fiscal cliff is a bit of a misnomer, but when it comes to taxes, the metaphor is apt. If all of the tax cuts, credits, and deductions set to expire at year end do in fact expire, incomes will fall off a tax cliff. Median earners will have 4 percent less in take-home pay in 2013 than they otherwise would; households making a million dollars or more would have 11.4 percent less.You can see what a fully armed and operational tax cliff would mean for different earners in the chart below from the nonpartisan Tax Policy Center.”
Get the full article HERE.
And from yesterday’s WSJ comes this ominous sounding article.
Here’s a small part of the article: The fiscal cliff bill’s impact would be far-reaching for American taxpayers, and particularly painful for very high-income households, according to a new analysis.
About 77% of American households would see a tax increase compared to their 2012 tax levels, according to the analysis by the Tax Policy Center, a joint venture of the Brookings Institution and the Urban Institute.
The biggest impact for most households comes from the expiration of a two-percentage-point payroll-tax break that existed for 2011 and 2012. It basically hits all working people. But the bill also contains sizable tax increases for the wealthy, compared with 2012 levels. (Of course, now that the fiscal cliff has arrived, supporters argue that the legislation actually represents a tax cut, because tax rates technically went up for just about everyone at midnight Monday.)
So, my question to everyone is: from your view, what impact (if any) does this portend for the real estate markets in MRIS territory? Is affordability at risk? Will a sequester affect DC employment rates and, thus, demand for real estate? Love to hear your thoughts on this very important topic!