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Tax cuts take effect
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July 2, 2001: 2:13 p.m. ET
A few more bucks showing up in paychecks of higher-income earners
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NEW YORK (CNNfn) - Taxpayers in the highest income brackets may notice a small change in their paychecks as early as this week: more money. The tax reductions that were signed into law by President Bush as part of his 10-year, $1.35 trillion tax cut package went into effect Sunday and will soon result in slightly higher pay for millions of Americans.
Emphasis is on the word "slightly." According to Frank Degen, an enrolled agent with the National Association of Enrolled Agents, the 1 percentage point chop will add just a few bucks to the pay of people who fall into tax brackets of 28 percent and higher.
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 TAX CUTS ARE COMING
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Tax cut schedule for 28%, 31%, 36% and 39.6% brackets
2001 to 2003: 1% reduction
2004 to 2005: additional 1%
2006 to 2010: additional 1% for all but 39.6% bracket which drops to 35%
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For example, a married person with a biweekly gross income of $2,500 will see about $6 additional in their paycheck. This is just the first in a series of scheduled reductions for higher-income taxpayers that will phase in between now and the year 2006.
Taxpayers in the 15 percent bracket will not see any reduction in their withholding taxes just yet. That tax bracket will drop to 10 percent, but those reductions will not be reflected in smaller withholdings until 2002. This year, however, they will receive refund checks of up to $300 for individuals, $500 for heads of household and $600 for married couples filing jointly.
Further tax reductions also are ahead for the approximately 35 million taxpayers who fall into the higher tax brackets. The 28 percent, 31 percent, 36 percent and 39.6 percent tax brackets drop by an additional percentage point in 2004 and in 2006. 
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