[Zeus]

The article is wrong in that some parts of the Taxcuts are already expiring.

April 21, 2004
When Would the President's Tax Cuts Expire?

by Andrew M. Grossman
WebMemo #486

In 2001 and 2003, President George W. Bush proposed and Congress passed a series of tax cuts to reinvigorate the economy and reduce the government’s burden on workers’ paychecks. Because of opposition to these measures from some in Congress, they were implemented as temporary tax cuts, all of which will expire by January 1, 2011. The uncertainty of their future has an effect on present-day spending by businesses and individuals, who know that they may have to pay higher taxes in the future.

Today’s economic recovery provides some evidence that the Bush tax cuts worked as intended. If Congress is serious about addressing economic growth and unemployment, it should make all of the 2001 and 2003 tax cuts permanent before the following expirations [1] can occur:

Child Credit: This credit will shrink from $1,000 to $700 per child on January 1, 2005.

• The 10 Percent Bracket: The upper income level for this bracket will decrease by $1,000 per filer on January 1, 2005.

• The 15 Percent Bracket for Joint Filers: On January 1, 2005, the upper limit of this bracket will shrink from 200 to 180 percent of the upper limit of the 15 percent bracket for single filers, creating a marriage penalty.

• Standard Deduction for Joint Filers: On January 1, 2005, this will shrink from 200 to 174 percent of the standard deduction for single filers, creating a marriage penalty.
• Alternative Minimum Tax: Exemptions will decrease by $6,500 per filer on January 1, 2005.
• Bonus Depreciation: This provision, which changes depreciation schedules for businesses in a way that encourages investment, will expire on January 1, 2005.

Small Business Expensing: On January 1, 2006, the maximum amount that a business may deduct will fall from $100,000 to $25,000, which will not be indexed to inflation.