Tax Law Changes of 2012

In: Social Issues

Submitted By pkolos1
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The bill officially titled “Unemployment Insurance Reauthorization and Job Creation Act of 2010 (HR 4853),” extended many of the Bush era tax cuts of “The Economic Growth and Tax Relief Reconciliation Act of 2001” (EGTRRA) that then President Bush signed into law. As per the announcement on Desire to Learn, I’ll call this new bill “The Bush Tax Cut Extension.” The bill was signed into law December 17, 2010. I am happy with most of the provisions and cuts as they positively affect most individuals’ lives in this country, including mine. The Bush Tax Cut Extension applies to small businesses as well but I will focus on the laws that affect mainly individuals. Working people, both rich and poor, will be able to save more with the tax brackets not increasing. They will pay less in taxes on capital gains from stock investing, continue to get credit for college tuition paid, continue to get a deduction for student loan interest, have a one year decrease of 2% for 2011 in the Social Security tax paid up to income of $106,800, continue to be able to deduct mortgage insurance premiums on a qualified mortgage as mortgage interest, and have many other benefits. This bill definitely helps students, homeowners, families with children, and both an average salaried worker making $35,000/yr. to a worker earning over $100,000/yr.

I like the extensions and think it was important, if not necessary, to extend these tax cuts, however, I wish they were extended beyond the two years that most of them were. I think this bill will allow us to keep more of our income and will further stimulate the sluggish economy that is desperately trying to rebound. I asked my manager at work what he thought about the decrease in the Social Security tax of 2%, and he said it was a “good thing.” This provision is for 2011 only and will save a $50,000 earner $1,000. The tax rates would have…...

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