Fiscal Cliff Affects Moms to the Tune of $4000

Think worrying about the fiscal cliff sounds is for people who aren’t  constantly living on the edge? Well – these expenses could push us moms over. It seems you’ll pay at least $2000 without blinking. But wait! Say you’re married with two school-aged children and an income of $40,000, because that person would pay $4400. And again – that’s baseline. Take a look to see exactly how money will fall out of our pockets.

1) Do you know about tax credits? At the moment, those of us earning under $43,000 can slice $1,000 directly from our tax bill for each of our children. Above that income, we lose some of the credit but still get a bit. After we go over the cliff, we’ll only be allowed to slice $500 for each kid, meaning it costs you $500 for each child you have. Two kids? That will cost you $1000. Three? $1500. You get the idea.

2) Once upon a time there was a penalty for getting married and it had nothing to with keeping the house at your husband’s favorite sub-arctic temperatures. It was a tax thing that made it more expensive to file as a couple than a single person. They call it a penalty because most of us – on average – spent an extra $1,400 a year, reports Roger Russell from Accounting Today. And it’s coming back, so prepare – if Congress does nothing – to pay.

3) A little somethin’ called The American Opportunity tax credit severely lowered parents’ taxes by letting us pay less for college tuition, fees and materials for higher education. But only for 2010-11-12. What’s that? You have a senior starting college next year? Let’s not even count this in the total because it’s so depressing.

4) You know that line of your paycheck that says “Social Security” and appears to take money away from you? Well, it’s going to take more, increasing by 2.2 percent for the first $110,000 you earn. That means if you (or your husband) earns $50,000, you’ll pay an extra $1000. The most it will cost you is $2,400 but we’ll assume that’s not particularly comforting.

But once you realize all our income tax rates will rise by 3 percent or more and that money we give the government for our good stock market picks is also going to increase by 5 percent, well, our incomes will be falling fast and landing hard.