The tax package that Congress passed on New Year's Day to prevent the country going over the "fiscal cliff" for long narrowly averted devastating tax increases and spending cuts. But there's a sucker punch---every employee in America will pay a 2 percent higher payroll tax in 2013.

The Tax Policy Center, a nonpartisan Washington research group, estimates that 77 percent of American households will face higher federal taxes in 2013 under the agreement passed by President Barack Obama and Congress on Tuesday.

A package of tax cuts first enacted under former President George W. Bush was scheduled to expire at the end of 2012, as part of the "fiscal cliff." Called the Bush-era tax cuts, families at every income level saw lowered taxes under the package, including reduced investment taxes and the estate tax, and an enhanced number of tax credits (example: $1,000-per-child credit).

While the package passed this week by the Senate and House extends most of the Bush-era tax cuts, Congress allowed a 2-percentage point cut in the payroll tax, which was enacted in 2010, to lapse. Workers will see what is automatically held out for Social Security rise from 4.2 percent to 6.2 percent on their next paycheck.

Social Security is financed by a 12.4 percent tax on wages up to $113,700, with employees paying half and workers paying the other half. President Obama and Congress extended the Bush-tax cut on Social Security in both 2011 and 2012, saving a typical family about $1,000 a year.  

See full story in the Sunday, Jan. 6, edition of The Advocate & Democrat.