An agreement to avoid the sharp tax hikes and spending cuts known as the fiscal cliff won't be reached before the midnight deadline, lawmakers in the Republican controlled House of Representatives said Monday, however, the Senate continued talks to reach a deal.

House Republicans notified lawmakers that the chamber will vote Monday evening on other bills. They said that will be their only votes of the day. Congress could pass later legislation retroactively blocking the tax hikes and spending cuts.

Earlier President Barack Obama and Senate Republican leader Mitch McConnell said they were near a deal to avoid wide-ranging tax increases and spending cuts _ the fiscal cliff _ that take effect with the new year.

Both men said they were still bargaining over whether _ and how _ to avoid $109 billion in cuts to defense and domestic programs that take effect on Wednesday.

Speaking from the White House, Obama expressed regret that his administration and Congress couldn't produce a "grand bargain" to address the country's chronic deficit spending, but he said that was impossible "with this Congress, at this time." Both sides have been unable to make such a sweeping deal since they set the midnight deadline in 2011 as motivation.

"There are still issues left to resolve, but we're hopeful Congress can get it done," Obama said. "But it's not done."

Officials familiar with Monday's negotiations said an agreement would address the biggest issue by raising tax rates on family income over $450,000 a year.

But how to handle deep spending cuts remained unsolved.

Some leading Republicans quickly objected to Obama's comments. "At a time of crisis, on New Year's Eve ... you had the president of the United States go over and have a cheerleading, ridiculing-of-Republicans exercise," Sen. John McCain said.

But Senate Republican leader Mitch McConnell said he and the White House had agreed on preventing tax hikes and that they were very close to an overall deal that would also prevent budget-wide spending cuts.

The hope of the White House and lawmakers was to seal an agreement, enact it and send it to Obama for his signature before taxpayers felt the impact of higher income taxes or federal agencies began issuing furloughs or taking other steps required by spending cuts.

The contours of a deal to avert the so-called "fiscal cliff" emerged Monday, as officials familiar with the negotiations said the agreement would raise tax rates on families making over $450,000 a year to 39.6 percent. The tax on estates worth more than $5 million would increase to 40 percent from 35 percent. Unemployment benefits would continue for one year. Without that extension, 2 million people would lose benefits beginning in early January.

But the officials said the White House and Republicans were at an impasse over what to do about automatic, across-the-board spending cuts set to start taking effect Tuesday. Democrats want to put off the cuts for one year and offset them with unspecified revenue.

The officials requested anonymity in order to discuss the internal negotiations.

A Republican official familiar with the plans confirmed the details described to The Associated Press.

Urgent talks continued between the White House and congressional Republicans, with Vice President Joe Biden and McConnell leading.

The deal would achieve about $600 billion in new revenue, the officials said.

Without an agreement approved by Congress by the start of New Year's Day, more than a half-trillion dollars in tax increases for nearly all Americans will begin to take effect, and $109 billion will be cut from defense and domestic programs.

Though both would be felt gradually, economists warn that if allowed to fully take hold, their combined impact would rekindle a recession.

Republicans, who control the House, have been loath to raise taxes. Democrats, who control the Senate and are in the White House, have been wary of cutting spending. Each side has been scared of looking like it's giving in to the other.

Meanwhile, the country's deficit spending _ about $1 trillion a year _ continues without a deal to address it.

"This whole thing is a national embarrassment," Sen. Bob Corker, a Republican, told MSNBC earlier Monday.

If there's no deal, the effects could be harsh. The U.S. would lose up to 3.4 million jobs, the Congressional Budget Office has predicted. And budget cuts of 8 percent or 9 percent would hit most of the federal government.

And if the limit isn't raised on how much the government can borrow, the government's officially reaching its $16.4 trillion ceiling on Monday could lead to a first-ever default in February or March that would shake worldwide confidence in the United States.

On top of that, the current Congress is in session only through midday Jan. 3. After that, a newly elected Congress would inherit the problem.

Letting tax rates rise for couples with incomes of $450,000 a year would be a concession for Obama, who campaigned for re-election on a pledge to set the level at $250,000 for couples. It also would mark a significant concession by Republican leaders who pledged to continue the George W. Bush-era tax cuts for all income earners.

The U.S. faces the fiscal cliff because tax rate cuts dating back to Bush's tenure expire at the end of the year. The pending across-the-board reductions in government spending, which would slice money out of everything from social programs to the military, were put in place last year as an incentive to both parties to find ways to cut spending. That solution grew out of the two parties' inability in 2011 to agree to a grand bargain that would have taken a big bite out of the deficit.

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Associated Press writers Julie Pace and Ben Feller contributed to this report.