A deal has been reached to avoid the so-called fiscal cliff, congressional sources have confirmed to ABC News.
The Senate will vote either Monday night or Tuesday. The House will vote likely on Tuesday.
The deal will include:
- A permanent tax cut extension for individuals making less than $400,000 and households making less than $450,000.
- Automatic sequester cuts postponed for two months (half of which will be paid for with cuts made elsewhere and the other half paid for with new revenue).
- Capital gains and dividends taxed at 20 percent.
- An estate tax at 40 percent for estates valued over $5 million.
- A one-year unemployment extension.
Now Vice President Biden must convince Senate Democrats to support this new deal.
A senior White House official confirms that House Minority Leader Nancy Pelosi and Senate Majority Leader Harry Reid have both approved the deal.
"It is a compromise, so we don't love it," says the senior White House official. "But it is the right thing to do for the economy."
Even with the deal's passage, another cliff stands to happen in two months when the debt ceiling is reached and the sequester cuts become activated.