What Happens If Congress Does Nothing?

More

If Congress fails to extend the Bush tax cuts, the tax system will undergo the equivalent of unelective full-body surgery. Higher rates will hit every dollar earned from income and investment. Benefits from low-income people will fall. Taxes on rich families' inheritance will come roaring back. Over ten years, the effect on total tax income for the government would be in the trillions of dollars. Americans will miss out on a media tax cut of about $1,000, as this graph from the

So it's no surprise that Congress is working to avoid this tax hike, at least for some people, at least for some time. The Obama plan is to preserve the tax cuts for about 98 percent of Americans and let taxes on the rich rise to their higher, 1999-levels next year. But what happens if he and Congress fail to act, the same way they failed to extend the estate tax in 2009? What will change, and how?

Taxes can be confusing. So here's a simple slideshow primer from a recent presentation on the Great 2010 Tax Debate from the Tax Policy Center. Many thanks to Roberton Williams for permission to run the presentation on The Atlantic.

Jump to comments
Presented by

Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

Get Today's Top Stories in Your Inbox (preview)

A Technicolor Time-Lapse of Alaska's Northern Lights

The beauty of aurora borealis, as seen from America's last frontier


Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register. blog comments powered by Disqus

Video

A Time-Lapse of Alaska's Northern Lights

The beauty of aurora borealis, as seen from America's last frontier

Video

What Do You Wish You Learned in College?

Ivy League academics reveal their undergrad regrets

Video

Famous Movies, Reimagined

From Apocalypse Now to The Lord of the Rings, this clever video puts a new spin on Hollywood's greatest hits.

Video

What Is a City?

Cities are like nothing else on Earth.

Video

CrossFit Versus Yoga: Choose a Side

How a workout becomes a social identity

Video

In Online Dating, Everyone's a Little Bit Racist

The co-founder of OKCupid shares findings from his analysis of millions of users' data.

Writers

Up
Down

More in Business

Just In