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Expiring Payroll Tax Cut Threatens To Hit Workers In Their Wallets

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(credit: File Photo/Clip Art)

(credit: File Photo/Clip Art)

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NEW YORK (CBSNewYork) — More than 17 million workers in the Tri-State Area benefit from the payroll tax break which took effect last year, and its scheduled expiration next month has many worried.

Antonio Meloni of Astoria is keeping his fingers crossed Congress will extend the break or come January 1 his taxes will go up.

“It’s really going to hurt because two of my kids are in college and of course $1,000, $2,000 can really help in paying tuition,” he told CBS 2’s Kristin Thorne. “It’s just another nickle and dime that’s not so small – $2,000 dollars is $2,000.”

President Obama, during a campaign stop in Scranton, Pennsylvania Wednesday, urged Congress to act quickly.

“It would be tough for you. It would be bad for the economy because we’re not fully out of the recession yet,” he said.

Rather than just an extension, Mr. Obama is pushing for expansion. For people who make $50,000 a year, the present tax cut would rise to $1,550 from the current $1,000 dollars.

Those who earn $100,000 currently get a $2,000 tax break. Under the president’s plan, it would go up to to $3,100.

As the December 31st deadline approaches, Democrats and Republicans are hashing it out on how exactly to cover the loss in revenue.

“If in fact we can find common ground on these extensions, I think you can take to the bank the fact that they will be paid for,” said House Speaker John Boehner.

Fellow Republicans say they would support extending the payroll tax cut but not if it means creating new taxes. Democrats want to raise taxes on those who make more than $1 million a year to offset the cost.

Should taxes be raised and the payroll tax cut be extended? Sound off in our comments section below…

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