Taxpayers Face Hit as Congress Delays Vote

Posted on October 7, 2010

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Lack of congressional action on 2011 income taxes may force the Treasury Department to make unprecedented moves to prevent U.S. workers from seeing large tax increases in their January paychecks.

The issue: 2011 tax-withholding tables. Treasury officials usually release the tables, which determine the take-home pay of millions of wage-earners, by mid-November because it takes payroll processors weeks to adjust their systems before Jan. 1.

But congressional leaders recently postponed voting on taxes until after the election and lawmakers don’t reconvene until Nov. 15.

A childless couple earning $40,000, for example, could see their monthly take home pay shrink by about $100, If they had three children, they might face a further cut of $125 a month.

Any Treasury move to extend the status quo involves risks: If lawmakers don’t follow through, taxpayers could wind up owing big tax bills at the end of the year.

via Taxpayers Face Hit as Congress Delays Vote – WSJ.com.

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