- FRC Brief 257 Version
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- February 28, 2013 Create Date
- February 13, 2020 Last Updated
FRC Brief 257, February 28, 2013, Robert Buschman
The “fiscal cliff” bill passed by the U.S. Congress January 1, 2013—officially the American Taxpayer Relief Act of 2012 (“ATRA2012”)—made permanent much of the Bush-era tax policy originally passed in 2001 and 2003, including the ordinary income tax rates for approximately 99 percent of Americans. However, in addition to raising rates for the other one percent, the bill also reimposed a relic of Clinton-era policy— the so-called Pease limitations on itemized deductions. The 2001 tax act phased out the Pease limitations, with complete elimination beginning in 2010, but they return under ATRA2012, effective this year. Because Georgia’s personal income tax piggybacks on the federal tax in many respects, and in particular with regard to itemized deductions, the reimposition of the Pease limitations will result in higher state income taxes for some Georgians compared to what they would pay had the limits not been reimposed. This brief summarizes the likely effects for individuals in Georgia.
ABOUT THE AUTHOR
Robert Buschman is a Senior Research Associate with the Fiscal Research Center. His research interests include corporate and personal taxation, public expenditures, macroeconomic policy, history of economic thought and economic history. Prior to joining the Andrew Young School, Bob worked for several years in corporate banking and corporate financial management. Bob holds a BA in Economics from Duke University, an MBA in Finance from the Goizueta Business School at Emory University, and a MA and PhD in Economics from the Andrew Young School of Policy Studies at Georgia State University.