The Obama administration’s intention not to renew tax cuts for the richest Americans which are set to expire at the end of the year has received much attention recently. However, the fact that some wealthy people may actually end up with a tax cut has been largely overlooked, according to CNN Money.
The news source reports that individuals earning more than $200,000 in adjusted gross income, or joint filers with an adjusted gross income of $250,000 or more, will move from 33 percent and 35 percent, respectively to 36 percent and 39.5 percent, which they paid before President George W. Bush implemented the tax cuts in 2001.
However, under the current plan, those with taxable income between $171,850 and $195,550 would go from the 33 percent to the 28 percent tax bracket, resulting in more than $1,000 in savings each ear.
Still, Robert Kerr, senior director of government relations at the National Association of Enrolled Agents, told the news provider that "the inadvertent tax break would only be noticeable to a very small subset of people, since no more than 5 percent of people have income at or above the [current] 28 percent bracket."
Regardless of this, most conservatives have criticized Obama for his intention to let the tax cuts for the rich lapse. They say this may stifle economic growth and have a negative impact on job creation in the midst of a slow economy.