Intense bargaining to avoid a US fiscal crisis appeared to stall on Wednesday as critical a year-end deadline nears.
President Obama and House of Representatives Speaker, Republican John Boehner, are locked in talks over a possible deal to avoid the so-called fiscal cliff of harsh tax hikes and automatic spending cuts that could badly damage an already weak economy.
However a rise in tensions threatens to unravel significant progress made over the last week.
The president and the top Republican negotiator have both offered substantial concessions that had made a deal look within reach, Reuters reports.
Mr Obama agreed to cuts in benefits for seniors, while Mr Boehner conceded to the president's demand that taxes rise for the richest Americans.
That climate of goodwill has evaporated since Republicans announced plans on Tuesday to put an alternative tax plan to a vote in the House this week that would largely disregard the progress made so far in negotiations.
On Wednesday, President Obama threatened to veto the Republican measure, known as Plan B, if Congress approved it.
Mr Boehner's office slammed Obama for opposing their plan, which would raise taxes on households making more than $US1 million a year and is a concession from long-standing Republican opposition to increasing any tax rates.
Mr Obama said he was puzzled over what was holding up the talks and told Mr Boehner's Republicans to stop worrying about scoring "a point against the president" or forcing him into concessions "just for the heck of it."
Through a spokesman, Mr Boehner said the White House's opposition to a backup plan was more bizarre and irrational by the day.
Mr Boehner expressed confidence the House would pass the legislation on Thursday. He urged Obama to "get serious" about a balanced deficit reduction plan.
Wall Street is on edge over the fiscal cliff talks although investors still expect a deal.
Business leaders have descended on Washington to lobby for a deal to avoid going over the cliff while putting public finances on a more sustainable path.
Without an agreement to narrow deficits over the long run, the United States could eventually lose investors' trust, triggering a debt crisis.
