Image via WikipediaPresident Obama announced tonight that an agreement has been reached on extending the Bush era tax cuts. At least for the next two years, there will be no tax increase for anybody. In addition, certain tax credits like the Child Tax Credit will also stay in place. One aspect of the compromise deal that I particularly like is a 2% tax cut on the payroll tax for next year.
This is particularly good news for me, and the timing is most fortunate. As I have mentioned here before, my share of my health insurance is slated to go up 23% in 2011. If the tax cuts are extended, as it looks like they will, then it would have been difficult to absorb the increased health insurance rates. If the tax rates had of expired, it would have been impossible to absorb it. With the additional news of the 2% payroll tax rate, it almost becomes a wash for me.