The Bush tax cuts are set to expire at the end of 2010, and President Obama and Congressional Republicans have offered competing proposals as to which aspects of the tax cuts should be continued. The two approaches would result similar effects for middle and upper middle-income taxpayers in Wisconsin, but they would have different impacts for low-income and especially for the very highest income groups.
President Obama has proposed making permanent the Bush income tax cuts for those making below $200,000 individually or $250,000 jointly and reducing the estate tax. President Obama is also advocating for making permanent the temporary expansions to the Earned Income Tax Credit (EITC) and Child Tax Credit that were included in the Recovery Act. These credits typically benefit lower income workers.
Congressional Republicans have proposed making permanent the Bush income tax cuts regardless of income, eliminating the estate tax, and not extending the EITC or Child Tax Credit expansion.