According to CNSNews.com, the U.S. House of Representatives voted 257-167 in the wee hours of the morning to approve a deal constructed by Vice President Joe Biden and Senate Minority leader Mitch McConnell (R-KY).
The deal phases out exemptions and deductions for individuals earning more than $250,000 per year and for couples earning more than $300,000. It also increases the income tax rate for individuals earning more than $400,000 and couples earning more than $450,000. According to the Republican Study Committee, these taxs effectively reinstate the "marriage penalty" by making married couples pay more than individuals at certain income levels.
The federal death tax was also reinstated with this bill and will now require a family to pay 40 percent of the value of all assets above $5 million when the senior member of a family dies.
In addition to raising taxes, the bill also spends money with no offsetting cuts, such as the $30 billion it provides for an extension of unemployment benefits.
The bill suspends the $110 billion in future spending cuts that was supposed to have kicked in effective January 1. This agreement was reached between House Speaker John Boehner (R-OH) and President Barack Obama in August 2011 when they struck a deal to increase the debt limit by $2.4 trillion.
An analysis of the bill by the Congressional Budget Office estimates that the deal will actually increase federal spending by $332 billion over the next ten years.
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