Fiscal cliff fiasco will affect your money
CAPE CORAL, Fla. - Tax experts say the fiscal cliff mess will affect your money.
Four In Your Corner's Colleen Hogan is finding out how the stalemate in D.C. could end up costing you.
Even if our elected leaders won't act, tax experts say you should, to make sure you keep as much money as your can in your pockets ahead of this fiscal cliff fiasco and tax increases that go into effect the first of the year.
"There are so many ways that a very large number of people in the population can be hit with increase taxes right now," tax expert Mary Feichthaler said.
Cape Coral based tax preparer Feichthaler says even if Congress comes to a compromise, your taxes are probably going up next year.
"We're also worried about ordinary income tax rates also jumping up to about 39.6 percent," Feichthaler said.
Even with a compromise, taxes on your investment income could skyrocket, even for those of us who aren't super rich.
Those itemized deductions like sales tax and mortgage write-offs that many of us rely on to lower our tax bill to Uncle Sam could go away
"That would be a huge change," she said.
You might have to hold out for your tax refund check too.
"The I.R.S. has gone on record saying right now they're afraid they're not gonna be able to accept tax returns from many people until March because they won't be able to get their systems up if there are any changes," she said.
So why the deadlock in D.C.?
President Obama and House Speaker John Boehner met Sunday to talk but no progress was made.
I asked Congressman-elect Trey Radel (R) if he thinks leaders can get this thing figured out.
Radel thinks a deal will be reached by Christmas.
"Where I think that the middle ground can be for both parties is to close up a lot of the loopholes in dedications, to bring in revenue but it needs to be matched by spending cuts," Radel said.
"What's wrong with the rich being taxed a little bit more?" Hogan asked Radel.
"When you raise a marginal tax rate, you are going to raise it on not just the ultra rich but small businesses. And if you wanna kill jobs right not in this terrible economy, there's not better way to do it," he said.
Your best bet for dealing with the uncertainly of this fiscal cliff? Feichthaler recommends getting as much income and deductions for this year, if you can.
Colleen Hogan, reporter