The White House and GOP reached an agreement in principle today to extend all the Bush tax cuts for two years, TPM has confirmed.
In exchange, the GOP has agreed to the Kyl-Lincoln estate tax compromise: raising the estate tax on estates larger than $5 million to 35 percent for two years and continuing to exempt smaller estates. The GOP has also agreed to a temporary stimulative payroll tax cut: instead of extending the making-work-pay tax credit in the stimulus bill, they’ve reportedly tentatively agreed to a one-year, two percent reduction in the payroll tax. Lastly, the Republicans have agreed to a extend unemployment benefits retroactively from December through the end of 2011 — 13 months altogether.
These details were first reported by the Daily Caller.
Obama met with Democratic leaders this afternoon to sell them on the plan, and I’ve been cautioned by multiple sources that the details could change pending their input. It’s not an agreement until everyone’s in agreement.
President Obama will address the media regarding this agreement at 6:10 tonight. We’ll get you more details on the deal when they’re available. It’s likely to upset a large number of Congressional Democrats, many of whom want the Bush tax cuts benefiting only the wealthiest Americans to expire, and to avoid relitigating this fight ahead of the 2012 election. However, keep in mind that no less a Republican than Rep. Paul Ryan (R-WI) said he didn’t expect to see any tax-side stimulus in the next two years. More on how stimulative this measure would be tomorrow.
Brian Beutler is TPM's senior congressional reporter. Since 2009, he's led coverage of health care reform, Wall Street reform, taxes, the GOP budget, the government shutdown fight, and the debt limit fight. He can be reached at firstname.lastname@example.org.