President Obama's $3.834 trillion budget would cut taxes for a large portion of the American population, but at the same time, the proposals are designed to levy heavy taxes on large firms, banks and high-income individuals and families.
Here's a look at some of the Obama administration's tax proposals and how they would affect Americans:
The budget overall includes more than $140 billion in tax cuts "designed to ease the burdens that middle class families face in caring for children, paying for college, and saving for retirement," according to the administration's budget "Greenbook."
The White House is seeking to make permanent the tax cuts introduced by the Bush administration in 2001 and 2003, for individuals making less than $200,000 per year and families earning under $250,000.
The Obama administration is also proposing to extend the "Making Work Pay Tax Credit" from 2009 for one more year. As part of that tax credit, individuals will receive $400 and couples filing jointly $800 on their tax returns. The administration estimates that under the program, $37 billion of tax relief was provided to 110 million families. The credit was funded through the $787 billion stimulus program signed into law last February.
Yet at the same time, those in the tax bracket above that limit -- higher than $200,000 for individuals and $250,000 for families -- will see an automatic decrease in their paychecks as the tax cuts for that income group expire at the end of this year. The tax rates will rise for individuals, from 33 percent to 36 percent and for couples, from 35 percent to 36 percent.
"I think he [Obama] has a really good chance for it becoming law because it doesn't require any action on the part of Congress," said Tom Ochsenschlager, vice president of taxation for the American Institute of Certified Public Accountants.
The tax increase is expected to bring in about $678 billion for the government over the next 10 years.
"The sounds you hear are the sounds of hard choices being made," one senior administration official told reporters Monday. "There is going to be a reckoning. There is going to be a time when we as a country have to deal in a bipartisan way with bringing down our deficit."
The budget specifically includes $100 billion for temporary initiatives to spur job growth, infrastructure and clean energy.
The White House is calling for $33 billion in tax cuts to be included in the new jobs bill. It would give companies a $5,000 tax credit for each new worker they add in 2010. Officials say this move would benefit a million Americans.
"We recognize that while we have made progress on jobs we have not made enough," said White House communications director Dan Pfeiffer. "There are still one in ten Americans looking for work. The president certainly doesn't find that acceptable."
The nation's unemployment rate currently sits at 10 percent. When the jobs report for January is released Friday morning, most analysts expect it to show that the country's employers shed another 50,000 jobs from their payrolls.
Additionally, businesses that increase wages or hours for their current workers in 2010 would be reimbursed for the extra Social Security payroll taxes they would pay.
The budget would also extend a provision in the stimulus bill to allow small businesses to write off up to $250,000 of qualified investments, a measure that the administration says will slash small business taxes by $1 billion during 2009 and 2010.
Ochsenschlager says the measures will likely have a significant impact on stimulating both small and big businesses, because they will be able to write off a huge chunk of their investments.
Obama also wants to eliminate the capital gains tax on new investments in small business, a move administration officials say would save small business owners $8 billion over the next decade.
At the same time, the White House is proposing to increase the top capital gains tax rate from 15 percent to 20 percent for families making more than $250,000 a year and individuals making more than $200,000. The proposal would raise about $105 billion.
The administration is proposing to extend for one year the provision in the stimulus bill allowing small businesses to immediately expense up to $250,000 of qualified investments.
Obama's budget calls for increasing the child care tax break for middle-class families.
"The budget will nearly double the Child and Dependent Care Tax Credit for middle-class families making under $85,000 a year by increasing their credit rate from 20 percent to 35 percent of child care expenses," according to the White House. Nearly all eligible families making less than $115,000 a year would see a larger credit.
The budget also provides $10,000 for a four-year college education due to the American Opportunity Tax Credit, which it is proposing to make permanent.
The budget proposes to eliminate the Advanced Earned Income Tax Credit (AEITC), a federal income tax credit program for low to moderate income working individuals and families. Those who qualify for the program are able to get credit on each paycheck during the year.
The administration said it is cutting the program "because it is used by very few taxpayers and has a very high error rate." Only 514,000 taxpayers took advantage of the benefit, and more than half of them received $100 or less, the administration said.
Additionally, the error rate in the program is high and some 80 percent of AEITC recipients did not comply with at least one program requirement, according to the Government Accountability Office.
The administration is also proposing to provide more funding to the Internal Revenue Service (IRS) to go after companies, specifically international operations, that under-report their taxes.
The president wants to increase taxes on U.S. companies with international operations, as well as on oil and gas companies, and impose a "financial crisis responsibility fee" on large financial institutions, raising $90 billion over the next decade.
The fee would recoup $90 billion in expected losses from the government's controversial $700 billion financial bailout program, enacted in the fall of 2008 by President Bush and continued by the Obama administration.
"We want our money back and we're going to get it," Obama said when proposing the fee in a White House speech last month.
The final budget has to be approved by members of Congress before it is implemented. Republicans are already seizing on the tax issue.
"While spending is going up, taxes are going up even faster. Taxes on Americans will increase by over $400 billion -- nearly 20 percent -- next year alone, with no improvement in sight. Does anyone truly believe this is a good time to raise taxes on job creators, or anyone else?" Senate Minority Leader Mitch McConnell, R-Ky., said in a statement.
McConnell pointed to the interest on the federal debt, which is expected to be nearly $6 trillion over the next 10 years, and rack up to $600 billion dollars in interest every year.
"That's an astonishing number," McConnell said.
House Minority Leader John Boehner, R-Ohio, said the budget taxes too much. The Republican rhetoric indicates that a tough fight could be ahead for the White House, which is standing by its proposals.
"One of the things that I think you'll hear this president and this economic team saying is, 'If you don't like a certain proposal that helps us restore us to fiscal discipline, what is your alternative as opposed to just saying no?'" a senior administration official told ABC News.
Experts say the president's budget proposal doesn't carry any big surprises and he's keeping with the promises he made during his campaign and as president.
"He seems to have kept most of the things that would help lower income and middle income individuals, but as he said ... even in the campaign, he's looking at the people who are not quite as needy," Ochsenschlager said. "My reaction is he's on track for his promises."