Payroll tax cut signed into law

WASHINGTON – President Barack Obama signed the payroll tax cut extension into law Wednesday, notching an election-year victory and rare bipartisan agreement in the continuing partisan battle over jobs, taxes and debt.

The $143 billion measure that Congress passed overwhelmingly on Friday continues the 2 percentage-point reduction in the tax that funds Social Security, a cut begun last year to aid the nation’s struggling economic recovery. It also extends jobless benefits for between 63 weeks and 73 weeks and averts a big cut in the reimbursements doctors get for treating Medicare patients.

The president signed the measure without ceremony Wednesday, having already celebrated its passage at an event Tuesday at the White House.

Obama senior adviser David Plouffe emailed his gratitude to people who sent the White House their stories about how losing the tax cut would affect their lives.

The administration estimates that for a worker earning $50,000 a year, the tax holiday means $80 a month in extra take-home pay. For better-paid employees, the bonus could total $2,200 a year.

But the cost to the deficit is substantial: another $93 billion for the latest extension. However, bowing to its inevitability, House GOP leaders last week agreed not to demand spending cuts to offset the lost tax revenues.