WASHINGTON (Reuters) - President Barack Obama wants Congress to agree to extend middle-class tax cuts now to take the edge off the looming "fiscal cliff" and leave tougher fiscal decisions for after November's election, the White House said on Thursday.

Obama's fellow Democrats and their rival Republicans in Congress are at loggerheads over whether to avert tax hikes on the very wealthy due to kick in at the end of this year, alongside spending cuts that could pinch the military.

The White House wants the Bush-era tax cuts for the middle class to be extended, but not those for the wealthy.

On Wednesday, the non-partisan Congressional Budget Office said that Americans should expect a "significant recession" and 2 million job losses unless Washington lawmakers are able to resolve their differences -- either in the post-election session of Congress or ahead of the November 6 vote.

White House spokesman Jay Carney, when asked about the CBO report, said the Republican-controlled House of Representatives ought to follow the Democratic-controlled Senate's lead and keep tax rates for 98 percent of Americans at their Bush-era levels.

He said retaining low tax rates for the middle class would ease most of the economic harm from congressional indecision.

"That would, in a single stroke, address a significant portion of the concern about the so-called fiscal cliff. It would not entirely deal with it, but it would have a significant impact," he told a news briefing.

Unlike ahead of last year's debt-ceiling deadline, when Vice President Joe Biden mediated a bipartisan panel on deficits, the White House has not led any formal efforts to negotiate an alternative to the year-end tax and spending crunch.

Carney told reporters the president was ready to engage with Republicans once they "demonstrate a willingness to accept that simple proposition that in addition to spending cuts, and in addition to entitlement reforms, revenue has to be part of it."

He later acknowledged that the "big conflict" between Obama and Republicans on whether to retain the tax cuts for top earners was "unlikely to be resolved between now and the election."

(Reporting By Laura MacInnis; editing by Philip Barbara)