Reply #12: Because if there is no deal, their taxes go up much higher than if we don't....

[FrenchieCat]

Scenario -

Currently w/t Bush tax cuts:
Single person earning $18,000 per year.
Taxable income in 2010 is $8,650.
Tax @ 10% = $884
Make Work credit is $400
tax liability is $484


With No deal & Bush tax cuts expired:
Same person earning $18,000 per year.
Taxable income in 2011 is $8,650.
Tax $ 15% = $1,297.50
No more Work credit
Tax liability is $1,297.50


With tax compromise:
Same person earning $18,000 per year.
Taxable income in 2011 is $8,650.
Tax $ 10% = $884
No more Work credit
add 2% in Payroll tax deduction
Tax liability is $524