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Richmonders brace for possible impact of fiscal cliff plunge

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RICHMOND, Va (WTVR) -- If lawmakers don't agree on a deficit reduction plan by midnight on New Year's Eve, automatic spending cuts and tax hikes will go into effect.  The Tax Policy Center estimates the average U.S. household will pay an additional $3,500 a year.  The tax hike has some stressed out and worried about their finances.

"I'm hoping that they make it happen," Richmonder Barbara Rosser said.  "I can't do it, you can't do it, it's up to the lawmakers to do it."

Toppling over the fiscal cliff is expected to impact 90 percent of Americans with Virginia expected to be hit especially hard.  If a deal is not reached in time, taxes would go up and government spending would go down.  And with only a few days left to prevent the U.S. from plunging off the fiscal cliff, many here in the Capital City are closely watching what's playing out on Capitol Hill.

"Taxes could increase for everybody," Rosser said.  "But right now I am just so optimistic and I'm just holding out for hope and praying to God that something will happen."

Others believe Congress will only reach a deal with less bickering and more bipartisan support.

"I just wish the parties could come together to make a decision for our country," Jimmy Stevens said.  "It's very scary."

It's a difficult situation that could become all too real for too many folks.  Families and businesses are bracing for fewer tax credits and higher taxes.

"It's been a whole lot of people with their taxes going up and there's going to be a lot of cuts in the military and Virginia is a big military state so it's going to be more than taxes," Raymond Heath said.

If that's not enough, more than 200,000 jobs are on the line if Congress does not reach a deal by the January 1st deadline.