Decision 2010 is finally gone and most races are complete. Some candidates are holding out for votes to trickle in, but for the most part we know who the leadership will be within our local, state and federal governments. How does Election Day 2010 pertain to my taxes?

The Bush Tax Cuts are set to expire, but with the Republicans ready to take control of the House of Representatives, the tax cuts are more than likely not going to expire. Also, President Obama has expressed interest in working with the Republicans with regards to taxes.

“My goal is to make sure that we don’t have a huge spike in taxes for middle-class families,” Obama said during an East Room post-election press conference. “Not only would that be a terrible burden on families who are already going through tough times, it would be bad for our economy.”

Americans are waiting to see how the Republicans will work with the Democrats over the next few months. Republicans may cooperate with the Dems over the next few months to make room on the agenda for next year to make changes to other laws such as the health care reform.

Interestingly enough, the people who could have the largest tax increase if the Bush tax cuts do expire without any change, are the individuals who make over $200,000 a year. Those people could have a huge impact on our economy.

Investors hope that extending the cuts could provide a pop in consumer spending. “From a near-term perspective, it would probably help resuscitate job creation and foster economic growth,” said Phil Orlando, equity strategist at Federated Investors in a recent article in the Wall Street Journal. Investors should also be concerned because if the cuts expire then the long term capital gain rate for most people would be 20% in 2011.

Stay tuned as the elected officials start to take office in 2011 and how the existing elected officials start to work with each other. If you have a concern that you will pay too much in taxes in 2011, you don’t have to wait until January to start working with your location income Liberty income tax preparation office.

-david rocci

Disclaimer: Every effort has been taken to provide the most accurate and honest analysis of the tax information provided in this blog. Please use your discretion before making any decisions based on the information provided. This blog is not intended to be a substitute for seeking professional tax advice based on your individual needs.