Obama: Would make the Bush tax cuts permanent for everyone except those making more than $200,000 ($250,000 if married). For those high-income households, Obama would preserve the Bush tax rates at the low end (10%, 15% and 25%) but raise the top two rates to 36% and 39.6%.
Romney: Would reduce the current Bush-era rates by 20% apiece. So the top rate would fall to 28% and the bottom rate would fall to 8%.
Alternative Minimum Tax: Currently, unless Congress makes special adjustments for inflation to the amount of income exempt from the AMT, the so-called wealth tax would hit tens of millions in the middle class. Making the adjustment is costly; getting rid of the AMT altogether is really costly.
Obama: Would permanently adjust the AMT for inflation.
Romney: Would abolish the AMT.
Investment income tax rates: Long-term capital gains and qualified dividends are taxed at 15%. Interest is subject to ordinary income tax rates. For those at or below the 15% income tax bracket, however, they have a 0% capital gains and dividend rate.
Obama: Would raise the capital gains rate to 20% and tax dividends at ordinary income tax rates for those making more than $200,000 ($250,000 if married).
Romney: Would maintain the current investment income tax rates, but exempt from taxation all capital gains, dividends and interest for those with adjusted gross income up to $100,000 ($200,000 for married couples).