WASHINGTON Dec 31 An emerging deal to avoid the
U.S. "fiscal cliff" would raise $600 billion in revenue over the
next 10 years by increasing tax rates for individuals making
more than $400,000 and households making above $450,000
annually, according to a source familiar with the talks.
The deal would also delay a series of automatic government
spending cuts, known as the "sequester," though a sticking point
remains on how long that delay would last.
The White House is pressing for it to be delayed a full
fiscal year and to include offsets made up of a mix of spending
cuts and revenue, the source said.
The deal would permanently extend middle-class tax cuts for
114 million households and includes a permanent fix for the
so-called "alternative minimum tax." It would extend
unemployment insurance for 2 million people for one year.
The deal would raise the estate tax for estates worth $10
million per couple or more to 40 percent from 35 percent.
The agreement would return capital gains tax rates for
individuals making $400,000 a year and couples making $450,000 a
year to what they were under President Bill Clinton. Including a
3.8 percent tax from Obama's 2010 healthcare law, dividends and
capital gains would be taxed at a rate of 23.8 percent.
The deal also prevents a 27 percent cut to reimbursements
for doctors who see Medicare patients, known as the "doc fix,"
and does not include cuts from Obama's healthcare law to do so,
according to the source.