President Barack Obama has read the annual State of The Union address to a joint sitting of both houses of Congress.
Obama urged Americans that it is time for the US to “turn the page” on years of hardship, as he urges Republicans to back tax increases on the rich to help struggling American families.
Mr Obama also called on lawmakers to pass a new authorisation of military force against Islamic State militants.
He will say the US-led effort to stop the extremists from advancing in Iraq and Syria is working without sucking the US into another Middle East ground war.
The Democratic president said: “We are 15 years into this new century.
“Fifteen years that dawned with terror touching our shores; that unfolded with a new generation fighting two long and costly wars; that saw a vicious recession spread across our nation and the world.
“It has been, and still is, a hard time for many. But tonight, we turn the page.”
The President will unveil a plan to increase the capital gains tax rate on couples making more than $500,000 per year from 23.8% to 28%, the same level as under President Ronald Reagan.
The top rate has already been raised from 15% during Mr Obama’s presidency.
He said: “Will we accept an economy where only a few of us do spectacularly well?
“Or will we commit ourselves to an economy that generates rising incomes and chances for everyone who makes the effort?
He was to add: “So the verdict is clear. Middle-class economics works. Expanding opportunity works. And these policies will continue to work, as long as politics don’t get in the way.”
During his Tuesday night speech, Mr Obama is also defending his outreach to normalise diplomatic relations with Cuba.
Alan Gross, the US aid worker whose release from detention by Cuba helped pave the way toward restoring diplomatic ties with the communist-ruled island, is among Michelle Obama’s guests for the speech.
Mr Obama recently pledged to “play offence”, using a sporting analogy, in the last two years of his presidency.
He has already used executive actions to thwart Republicans who in November’s midterm elections took control of both houses of Congress for the first time since he came to office.
Six years after Mr Obama came to power during the Great Recession, unemployment has dropped below 6%, the stock market has rebounded to near record levels, growth is surging and petrol prices have plummeted.
A recent ABC/Washington Post poll saw Mr Obama’s approval rating soar nine points to 50%.