The fascinating thing about the upcoming Obama tax hikes – and I imagine that the irony that if the Democrats had just made Bush’s tax cuts permanent in the first [place] then they wouldn’t be in this mess right now hasn’t been lost on the Democratic leadership* – is that they’re hardly inevitable. The current ratio is 255/180 Democrat/Republican in the House; 58/41 (Kirk needs to be seated, still) in the Senate. The Democrats can easily pass a bill that will ensure that people’s taxes will not automatically rise in January; and they can pass it whenever they like.
And, really, the Democrats know this. They’re just being petulant about the fact that the Republican party is disinterested in indulging the Democrats’ desire to not face the consequences of their party’s actions earlier in the decade. Because this is what happens when you adopt a strategy of ‘kick the can down the road:’ eventually, you meet up with the can again.
And sometimes people won’t let you have another kick.
Moe Lane (crosspost)
*At least, it hasn’t been lost on those parts of the Democratic leadership who are right now looking for gainful employment in the private sector. Which, entertainingly enough, is the portion of the Democratic leadership that was most ideologically comfortable with making the original tax cuts permanent, but suborned those impulses in order to fall in line behind progressives. Karma is a marvelous thing.
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Even if Obama's tax hikes are avoided soon
conservativemountaineer Sunday, November 21st at 1:42PM EDT (link)there may not be enough time for the IRS to (a) re-do the withholding tables and rates for payrolls, (b) publish/distribute those tables and rates to payroll service providors (such as ADP or bookkeepers), companies that do their own payrolls, *and* allow payroll providors enough time to program those tables and rates. I believe the withholding tables and rates were published on or about November 20th last year. It takes time to publish and distribute Circular E.
I fully anticipate some *surprised* employees in early January 2011 when their net pay is a lot less than their last net pay(s) in December 2010. I use ADP to pay my employees (weekly payrolls). Our first pay date in Thursday, January 6th; I have to input hours and earnings on Monday January 3rd.
I have already informed my employees of the possibility that their take-home pay may be adversely impacted starting with the first pay in January.
*I did it before the election, by the way.* /snort
Just because the cloud has a silver lining doesn’t mean it’s not going to rain.
Consider, though, that the Dems who were most likely to...
acat (Diary) Sunday, November 21st at 1:53PM EDT (link)make the tax cuts permanent are also the ones who just lost seats.
And the ones who are left … well, they’re the inner-city hard-shelled liberals. Even extending the Bush tax cuts is like fingernails on those hard liberal shells…
Mew
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Caveat Suffragator
I wouldn't be so sure of that...
conservativemountaineer Sunday, November 21st at 5:03PM EDT (link)unless many of them had a ‘come to Jesus’ revelation and wanted to stick a knife into Obama/Reid/Pelosi.
However, the point of my comment is that — even *if* Congress voted against the Obama tax hike(s) before then end of the year, it is highly unlikely the tax withholding tables could be written, published and distributed in time so as to avoid wage earners being surprised with their first payroll or so in 2011.
We (hopefully) can count on the new Congress to address the matter, but that will not be until early January. By then it’s waaaaaayyy too late and any resolution (a/k/a reverting to 2010 tables pre-Obama tax hike) will not be felt until late January 2011 or early February 2011. Any excess withholdings will stay with the IRS until tax returns arte filed in April 2012.
If Obama’s tax increase is not halted prior to December 31, I may advise my employees to increase their expemtions on the W-4 (until the matter is resolved). I *know* I will.. 10 exemptions seems about right. /snort
Just because the cloud has a silver lining doesn’t mean it’s not going to rain.
You're right on withholdings for January...
acat (Diary) Sunday, November 21st at 5:59PM EDT (link)but only applies to smaller shops that do their own payroll. Anyone whose payroll is outsourced to ADP or similar will be fine as long as the tables drop by Dec. 31.
It’s an issue, but .. I expect it to be like Y2K with no nationwide disruption, only one affected pay period, etc. etc.
Unless, of course, the Dems in the lame duck decide to do .. nothing.
Mew
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Caveat Suffragator
I'm not as optimistic as you because...
conservativemountaineer Sunday, November 21st at 6:14PM EDT (link)it’s highly unlikely ADP or any other payroll service providor will be able to program their payroll systems if the new withholding tables are distributed after, say, December 15th… there’s this little problem called software coding and testing and the fact there are not, or will not be, a whole lot of workdays left in the year.
I think we could very well see a stand-off between the libs and conservatives.. unknown is how the lame-duck Reps/Senators will go.. and what about those who are vulnerable in 2012?
I guess I could look on the bright side.. if even only *one* payroll period is affected (and that would be for 1,000s and 1,000s of people that work for companies that use ADP/Paychex, etc.).. we could get a whole lot more voters on our side. My guess it very well may be that more than one payroll period will be affected.
Gonna buy some more popcorn next trip to the grocery store.
Take care.
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Just because a cloud has a silver lining doesn’t mean it’s not going to rain.
Just because the cloud has a silver lining doesn’t mean it’s not going to rain.
Umm, I'm well aware of coding.
acat (Diary) Sunday, November 21st at 10:08PM EDT (link)And I’m also aware that the data has to fit one standard – a table. It’s possible to write the software around the table, and test with some wild-ass guess data.
I also think that ADP et al know it’d be cheaper to have their coders working from Dec. 15 thru Jan. 1 24 hours a day, 7 days a week to get it done than it would for them to handle calls and legal issues if they don’t get it coded up. Because for ADP et al, it’s tens of millions of people who would be affected.
That doesn’t mean they’ll get it right.
Mew
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Caveat Suffragator
If the tax cuts are extended, they will be using the old code--it already exists
JSobieski (Diary) Sunday, November 21st at 10:17PM EDT (link)nt
Did you know that China has been losing manufacturing jobs since 1995? For the specific data, see Table 1 in the following link: http://www.bls.gov/opub/mlr/2005/07/art2full.pdf
I'm a cold-hearted mercenary when it comes to this
E Pluribus Unum (Diary) Sunday, November 21st at 8:34PM EDT (link)I agree that this is not going to come to an immediate resolution, and I also agree that payrolls for a short time will reflect the temporary, what we shall call the “Obama” tax increase, probably up into February.
Now my opinion about that: for the everyday voting, working American, it will highlight the contrast between what Republicans do to your take-home pay vs what Democrats do to your take-home pay.
Which will affect votes in November 2012.
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The gap's a little long for Joe Sixpack.... [nt]
acat (Diary) Sunday, November 21st at 10:21PM EDT (link)——
Caveat Suffragator
I'm not sure people will notice
nycenterright Monday, November 22nd at 12:18PM EDT (link)A lot of people might need to be reminded.
A relative of mine is a college professor making about 50k per year. I did some back of the envelope calculations and it looks like he’ll be out about 35 bucks out of a 2k paycheck. Since paychecks tend to fluctuate a little bit anyway, I’m not sure most people will even realize what’s happened.
Certainly, someone making 300k, who is losing about $125 will notice, but I think most people who make that much money are paying closer attention in the first place and already know what’s going to happen to them.
Ludicrous
frankieb (Diary) Sunday, November 21st at 2:51PM EDT (link)Our kids, grandkids, nieces and nephews can ill afford the tax hike. Of course, we as a nation could ill afford the people they voted into office in 2008. Maybe it really is karma.
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Democrat line - it's Bush's fault!
Stan Sunday, November 21st at 3:54PM EDT (link)I saw Kirsten Powers on Fox today — she actually said this is all Bush’s fault! That this was the way he (Bush) had structured the tax cuts, so blame it on him!
Bwa-ha-ha-ha-ha-ha-ha-ha-ha-ha-ha!!!!!!!!!!
What a bunch of morons…
What a lyin' 'ho' she is!
Adjoran (Diary) Sunday, November 21st at 6:30PM EDT (link)The only reason the tax cuts were “structured” this way – temporary – is because Senate Democrats filibustered the permanent cuts, so the only way Frist could get them in was through the Reconciliation process, and those rules specify any tax or spending changes must be temporary.
I don’t get it. Unless the Democratic Senate is determined to block the tax cuts altogether, why not make sure Pelosi & Co. get it through in the lame duck so Democrats can claim credit for it?
First off: mind your language, please.
Moe Lane (Diary) Sunday, November 21st at 8:54PM EDT (link)People read this site at work.
Second: if the Democrats stop the tax hike they will never hear the end of it from their own base, which is why they’re still grinding metal on this one.
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bushes fault
silentcalrox Monday, November 22nd at 12:17AM EDT (link)I too watched kirsten go to the playbook on fox; she’s pretty, but dumb as a box of rocks!
That's a disgrace about Kirk.
swami7774 (Diary) Sunday, November 21st at 8:27PM EDT (link)But it’s not unusual. Massachusetts Dems pulled the same crap last January, delaying seating Scott Brown as long as possible.
They’re very small people. You might say they cling, bitterly, to power.
Today, there is a name for the political doctrine that rejoices in scarcity of everything except government. The name is environmentalism.