Wisconsin Watches Fiscal Cliff Closely
Photo: Video by nbc26.com
Governor Scott Walker meeting with President Obama at the White House Tuesday to discuss the problems Wisconsin will face if there's no solution to the so-called fiscal cliff.
The fiscal cliff is a rattling combination of Bush-era expiring tax cuts and major spending reductions. If both sides can't hash out a deal before the end of the year, then we all go over the cliff.
"This fiscal cliff is kind of terrifying," working mom Amanda Westphal said. "I'm checking my online money and seeing where I'm at daily."
Westphal is not ready to take the plunge.
"The idea of not only the tax cuts being taken away, but also me and my husband being moved into a higher tax bracket is extremely frightening because we don't know how to plan for next year," Westphal said.
According to the Tax Policy Center, if democrats and republicans can't hash out a debt relief deal by January 1st to avoid the fiscal cliff, about 90% of people will pay more in taxes.
The center predicts the average increase will be almost $3500.
"It will hurt Wisconsinites pocketbooks, and from my perspective as a banker, I think it's going to have some trickle down effects," banker Peter Prickett said.
Prickett says another big blow to the state $1.2 trillion in cuts that would be split between domestic and military spending.
"I personally don't think it will send us into a recession. I do think it will be some drag on the economy," Prickett said.
For Westphal waiting is the hardest part.
"You never know what they're going to do. If it goes through we roll with the punches and do what we have to do," Westphal said.
According to a federal income tax calculator, a married couple with a joint income of $50,000 could expect to pay more than $2,000 in taxes next year compared to this year, if we go over the cliff.