The US House of Representatives will not vote on Monday on an 11th-hour proposal to prevent the country from tottering over the so-called "fiscal cliff," a senior Republican source told AFP.
US markets will not immediately feel the shock of the failure as January 1 is a public holiday, giving lawmakers a short breathing space in which to hammer out a stop-gap deal and pass it through the Senate and House on Tuesday.
Lawmakers worked feverishly through the night to hammer out a deal that would raise tax rates on the wealthy but preserve tax breaks for the middle class and maintain some key stimulus benefits like unemployment insurance.
At the end of the day Monday, while President Barack Obama and lawmakers acknowledged they were close, there was still no finalized deal between Senate Republicans and Democrats, including Vice President Joe Biden who is now playing a key part in negotiations.
"We don't have anything to vote on," the senior House Republican source said, referring to the lack of any bill in the Senate.
There was "no chance they pass something early enough that we could (vote) before midnight, even if we wanted to," he said.
Another House Republican source sought to downplay the fact that lawmakers were missing their self-imposed deadline.
"If a deal is reached, there's little difference between a vote tonight or tomorrow to give members a chance to review," the source said.
Some would argue there is a very clear distinction.
Passing a measure on New Year's Eve would mean Republicans -- who by and large oppose raising taxes on anyone -- vote for a tax hike on the wealthy.
If they wait until January 1, when the tax cuts first enacted under president George W. Bush expire and rates go up on everyone, Republicans could then turn around and vote to reduce taxes on the middle class.
As for whether the Senate could get it together to at least present a bipartisan deal before the year end, the number-two Republican in the chamber was non-committal.
"I don't know" if a Monday night vote was still possible, Senator Jon Kyl told AFP.
The Republican caucus was going to "try to get together here before long, and at least review the bidding and see where we are," he said.
"A lot of progress has been made, and I think it's obvious that we either have to have something finished here very soon or it's not going to happen."