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IPFS News Link • TAXES: Federal

No New Taxes: Except The Massive One That Will Sock The Economy

At its core, the move is merely the highest tax bracket returning to 39.6% from its 35% low and raising the 33% bracket to 36%, according to the Obama administration's budget. The estate tax of 45% would also become permanent, with an exemption of $3.5 million. While these increases appear just to target wealthy Americans, they also hit small businesses. Says Andrew Moylan of the anti-tax National Taxpayers Union: "According to IRS data, there are nearly 26 million small employers (about 20 million sole proprietor ships and 5.9 million businesses with less than 99 employees) that file under the individual income tax code and pay taxes on the owner’s 1040 form." The impact would be felt most in homes making less than $200,000, according to Moylan, with higher taxation hitting 2/3 of small business profits.