Patrick Cobb, communications director for AARP South Carolina, brings news and views about Congressional relations in Washington — the fiscal cliff, sequestration and the recent security breach.

“We have been hearing and reading about the fiscal cliff and “sequestration” but questions are asked what does this mean? Congress passed the Budget Control Act in 2011 requiring Congress to address the deficit by Dec. 31 or face automatic cuts to domestic and defense spending averaging 8 percent to 9 percent.

Dec. 31 passed and Congress did act at the 11th hour and partly addressed the deficit but postponed addressing other parts for two months. However, Congress did pass breaks into three arrears:

1. Impact on the wealthy

2. Impact on the middle class and lower income families

3. Other

Wealthy tax rates will permanently rise to Clinton-era levels for families with income above $450,000 and individuals above $400,000. Those with income below the threshold will permanently be taxed at Bush-era (lower) rates. The tax on capital gains and dividends will be permanently set at 20 percent for those with income above the $450,000/$400,000 threshold. It will remain at 15 percent for everyone else. The estate tax will be set at 40 percent (from 35 percent) for those with a $5 million exemption. That threshold will be indexed to inflation. Two limits on tax exemption and deductions for higher-income Americans will be reimposed: Personal Exemption Phase-out (PEP) will be set at $250,000 and the itemized deduction limitation (Pease) kicks in at $300,000.

Middle and Lower Income: The Alternate Minimum Tax will be permanently patched to avoid raising taxes on the middle class. The 2009 expansion of tax breaks for low-income Americans: the Earned Income Tax Credit, the Child Tax Credit, and the American Opportunity Tax Credit will be extended for five years. Federal unemployment insurance will be extended for another year, benefiting those unemployed for longer than 26 weeks. The deal will not address the debt-ceiling, and the payroll tax holiday will be allowed to expire. Workers will again be paying full 6.2 percent for SSA and Medicare. Will cost workers and employees about 2 percent more.

Other: Aspects were passed.

— Scheduled cuts to doctors under Medicare would be avoided for a year through spending cuts that haven’t been specified. Without

— Medicare payments would be cut by 27 percent — risk of doctors not taking Medicare patients.

— The pay freeze on members of Congress will be re-imposed.

— A full package of temporary business tax breaks will be extended for another year.

— A much feared spike in milk prices, dubbed the dairy cliff will be averted through a nine-month extension of certain portions of the farm bill.

— The sequester will be delayed for two months.

Half of the delay will be offset by discretionary cuts, split between defense and non-defense. The other half will be offset by revenue raised by the voluntary transfer of traditional IRAs to Roth IRAs, which would tax retirement savings when they are mover over.

Question: What happens during the two month delay? Congress and the White House go back to the bargaining table to work on other aspects, especially spending cuts. (AARP is worried spending cuts could impact Social Security and Medicare.)

Question: What can readers do?

Call their House member and our two Senators and urge them to protect these important programs for seniors.

Security Breach:

South Carolina residents concerned about the recent security breach within the SC Department of Revenue need to take several steps to protect their privacy. The State of South Carolina is offering a one-year free credit monitoring service through Experian.

STEP ONE: To enroll in the service, you must do the following: Log onto this website: www.protectmyid.com/scdor or call 1-866-578-5422, Activation code: scdor123 (not case sensitive)

STEP TWO: You can also call the three credit agencies and place a freeze on your credit file for FREE through the automated system.

Experian 1-888-397-3742

Equifax 1-800-525-6285

TransUnion 1-800-680-7289

When needed you can lift or “thaw” the credit freeze by contacting each agency and use the unique PIN that is assigned to you. There is no charge for this service nor does it affect your credit score as an inquiry.

STEP THREE: Request a free copy of your credit report through the Federal Trade Commission’s website or call 1-877-322-8228. You are entitled to one free credit report from each of the three agencies once a year. You may choose to order one report every four months.