Why Passing the “Middle-Class” Tax Cuts Benefits the Wealthy, Too
President Obama today clarified an important, and often misunderstood, point: the so-called “middle-class Bush tax cuts” also benefit high-income people. So, if the House were to approve the Senate-passed bill to extend the middle-class tax cuts (as the President favors), “that would prevent any tax hike whatsoever on the first $250,000 of everybody’s income,” he said at his press conference.
That’s because the middle-class tax cuts do not just apply to people making less than $250,000 but to incomes — for everybody — up to $250,000 ($200,000 for singles).
In fact, as this chart based on Urban-Brookings Tax Policy Center data shows, extending the “middle-class” tax cuts would be worth about $12,000 next year to people making between $200,000 and $500,000.