Sharp U.S. tax increases and government spending cuts will take effect in January unless Congress and President Barack Obama can agree on a package of deficit reduction measures.
With lawmakers rushing to avert events that could trigger another recession, here is a look at key dates ahead, with estimated impacts based on research by the Tax Policy Center and the Bipartisan Policy Center, both non-partisan think tanks.
Continue Reading Below
* Dec. 14. This was the targeted adjournment date for the U.S. House of Representatives, but it has been postponed. The U.S. Senate has not set an adjournment date.
* Dec. 17. Unofficial optimal date to have a "framework" for a deal in place, congressional aides say, in order to permit time for review and procedural delays in Congress. Congress can go beyond this time without much trouble, however.
* Dec. 21. Target date for a final deal that would permit lawmakers a full holiday break, aides say.
The House could be in session through at least Dec. 21 and will not adjourn "until a credible solution to the fiscal cliff has been found," according to Republican House leadership.
* Dec. 24. Some skeptical aides say Congress will work to Christmas Eve, possibly reaching a deal, or possibly not.
* Dec. 25. Christmas holiday.
* Dec. 26-31. If no deal has been reached by this time to raise the government's debt ceiling of $16.4 trillion, the U.S. Treasury Department will have to take "extraordinary measures" to put off possible default, as it has done before.
If Congress does not have a "fiscal cliff" deal before Christmas, lawmakers may have to return to Washington this week.
* Jan. 1. Expiration of low tax rates enacted under President George W. Bush and extended in 2010 under Obama. This event would raise taxes an estimated $1,600 per U.S. household annually.
Expiration of Obama payroll tax cut of 2011 and 2012. This would raise taxes an estimated $700 per household.
Deadline for dealing with "tax extenders" such as the corporate research and development tax credit. These and other items must be extended by year-end to be claimed in 2013.
Deadline for fix to the alternative minimum tax. Without action, the AMT will increase the tax bills for an estimated 27 million more Americans. T h e Internal Revenue Service will need to reprogram systems and delay refunds for millions of taxpayers until late March if the fix is not passed.
* Jan. 1. New taxes take effect under Obama's healthcare overhaul. One is a 0.9-percent increase in wage income tax for individuals earning more than $200,000 a year. The other is a 3.8-percent Medicare tax on investment income above the same level. These take effect regardless of the cliff outcome.
* Jan. 2. Without congressional action to waive or postpone them, spending cuts of $1.2 trillion over 10 years begin. Known as "sequestration," these were put in place in 2011 after a congressional "super committee" failed to devise a fiscal plan.
* Jan. 3. The new Congress is scheduled to convene.
* Jan. 7-11. Congress scheduled to be out of session.
* Jan. 14. Congress scheduled to reconvene.
* Jan. 20. Presidential inauguration day. A public ceremony is planned for the following day.
* February. White House releases annual proposed budget. Treasury exhausts its "extraordinary measures" and U.S. faces possible rating downgrade again.
* March. Funding of federal government expires with the expiration of a continuing resolution.