Sweeping US government spending cuts totalling $85bn will begin today, in an unwanted move towards austerity that lays bare Washington’s paralysing partisan divisions.

The shape of a deal to avert the US "fiscal cliff" is emerging with just hours to go before a midnight deadline, Washington sources have said.

The White House and US Senate Republicans sorted through disputes over taxing the wealthy and cutting the Defence Department and other federal agencies as tonight’s midnight deadline for avoiding a “fiscal cliff” drew to within hours.