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How will going over the fiscal cliff affect your wallet?
Don't Waste Your Money
President Barack Obama (R) shakes hands with Speaker of the House John Boehner (R-OH) during a meeting with bipartisan group of congressional leaders at White House on Nov. 16, 2012 in Washington. (Olivier Douliery-Pool/Getty Images)
Copyright 2012 Scripps Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Posted: 12/28/2012
A lot of people may not be celebrating New Year's Eve if Congress doesn't do something to avert the upcoming fiscal cliff.
On Tuesday, Jan. 1, unless lawmakers in Washington reach an agreement, taxes will go up for everyone and government programs will be slashed.
On Tuesday, Jan. 1, unless lawmakers in Washington reach an agreement, taxes will go up for everyone and government programs will be slashed.
Small business owners will be sweating it, not knowing what's going to happen to them if a deal isn't reached.
Business Owners Uncertain
At Cincinnati's Findlay Market, merchants are busy selling foods for New Year's Eve gatherings.
Mike Luken has run his family's seafood market since 1977.
But he has never entered a new year with such uncertainty, knowing that his eight employees will be looking at smaller paychecks.
"The payroll's not gonna change, they're going to be paid the same amount of money," he said. "But what's going to happen with taxes, and the extra $10 or $15 you had every week in your paycheck: Is that going to disappear?"
Luken says it's going to be a one-two punch for his employees.
No sooner will they get used to smaller paychecks in January then they may get another cut in February, as he has to readjust for rising health care premiums.
"We offer health insurance to some of our employees, but we have no idea where that's heading also. Except the rates, when we renew in February, are going to be higher," he said.
That, he says, will hurt everyone from him to his employees to his customers, which will mean less money coming in.
"If they lose $10 a week, over a year's time, what does that amount to: Them going out to dinner once or twice, or vacation?"
Mike Luken has run his family's seafood market since 1977.
But he has never entered a new year with such uncertainty, knowing that his eight employees will be looking at smaller paychecks.
"The payroll's not gonna change, they're going to be paid the same amount of money," he said. "But what's going to happen with taxes, and the extra $10 or $15 you had every week in your paycheck: Is that going to disappear?"
Luken says it's going to be a one-two punch for his employees.
No sooner will they get used to smaller paychecks in January then they may get another cut in February, as he has to readjust for rising health care premiums.
"We offer health insurance to some of our employees, but we have no idea where that's heading also. Except the rates, when we renew in February, are going to be higher," he said.
That, he says, will hurt everyone from him to his employees to his customers, which will mean less money coming in.
"If they lose $10 a week, over a year's time, what does that amount to: Them going out to dinner once or twice, or vacation?"
If We Go Over...
CNN says if the Cliff hits:
CNN says if the Cliff hits:
- Everyone's Social Security tax will rise from 4 percent to 6 percent
- The child tax credit will be reduced
- Two million people will lose their extended unemployment benefits
- 30 million people will be hit by the AMT
9 On Your Side financial consultant Crystal Faulkner says if you have any stocks to sell or income to take, do it Monday, Dec. 31 because your tax bill will be lower.
"In my view, it makes a lot of sense to accelerate that income into this year, 2012, because taxes are not going to be any lower than they are right now," she said.
Finally, if we go off the cliff, farm subsidies will be cut, with some analysts saying the price of a gallon of milk could double to $6 or $7.
A big price for all of us to pay if Congress and the president can't reach a deal. As always, don't waste your money.
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"In my view, it makes a lot of sense to accelerate that income into this year, 2012, because taxes are not going to be any lower than they are right now," she said.
Finally, if we go off the cliff, farm subsidies will be cut, with some analysts saying the price of a gallon of milk could double to $6 or $7.
A big price for all of us to pay if Congress and the president can't reach a deal. As always, don't waste your money.
_________________________
Don't Waste Your Money is a registered trademark of the EW Scripps Co.
"Like" John Matarese on Facebook
Folllow John on Twitter ( @DWYM )
Copyright 2012 Scripps Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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