WH: Families' taxes could rise $1,600

WASHINGTON -- A standoff with Congress that results in wide-ranging tax cuts expiring in January would mean 114 million families would see average tax increases of $1,600 next year, the White House says.

In a report yesterday on the tax standoff with Republicans, the White House tried putting a human face on the showdown and shifting the blame to the GOP. "So far, the only reason the middle-class tax cuts have not been extended is that Republicans in Congress continue to insist on cutting taxes once again for the wealthiest few," the report said.

Republicans want to renew all the tax cuts for one year to give the two sides time to negotiate permanent tax changes. President Barack Obama and Democrats also want a yearlong extension, but insist they will extend only the reductions for households earning below $250,000.

Last week, Sen. Patty Murray (D-Wash.), a member of her party's leadership, said if there is no deal by January, her party would be willing to let all the tax cuts expire to pressure Republicans to give ground. Republicans accused Democrats of being willing to raise taxes on everyone as the price for prevailing.

"They're ready and willing to go right off the fiscal cliff if they don't get their way," Senate Minority Leader Mitch McConnell (R-Ky.) said. He cited the frequently used term "fiscal cliff" to describe the economy-rattling tax increases and spending cuts that will automatically take effect when 2013 begins unless lawmakers reach a compromise for avoiding them.

The $1,600 average tax increase would be for all families earning under $250,000, White House officials said. The numbers of families from this group would range from 13.2 million in California to 200,000 in Wyoming, the report said. -- AP