I think it behooves the RNC to tell their people to compromise quickly on this and allow just the Bush cuts to expire on those making above a certain level($150K or $250K).
The Bush tax cuts expire and they do not have the power to stop that.
Most Americans(I have seen polls with numbers as high as 70%) are for tax increases for the $250K+ income bracket.
Compromising on this saves tax increases on most Americans and the Republicans can at the very least twist it that they were responsible for stopping those increases and that it was the Democrats that wanted to increase taxes on everyone. Or they can give in and get some entitlement spending cuts that would make their base extremely happy.
Heck a freeze on Medicaid spending for the next 4 years would make me happy. Drug testing on Medicaid recipients would also make me happy. A tripling of the funds to investigate Medicaid fraud would make me happy(this funding usually produces more fraud savings than money spent on the funding in the first place). I also know this is a big one but, I think the easiest way to investigate Medicaid fraud is through medical records. I think Medicaid recipients should release all medical records to the government. If the government is paying the bill, why shouldn't they have access to the records to investigate fraud?
I'm in favor of people making over 250L getting a tax incease if their income doesnt come through pass through entities or as a result of sole proprietorships.
Basically, tax the fatcats on wall stret. Don't tax those that put themselves on the line to start a company.
Here's the problem I have with this.
If you own or have owned a small business then you know there is a ton of ways to hide income. Parts of your mortgage becomes business related, you cars become business related, your vacations become business related, your credit card bills become business related, furniture bought for your home becomes office furniture, etc, etc.
There's a ton of ways of doing it.
If you're a smart business owner you are doing this. If you have a great business and are a smart business owner and are making over $250K per year, you are already hiding more income than the measly 5% tax increase is going to cost you.
If you make over $250K as a small business owner chances are you are really making a lot more than that.
Just pay the tax.