"There is a concern that you extend those tax cuts for even a year and that's a way to get a foot in the door and actually continue to extend them and make them permanent," he said.
"So, the right way that financial markets might perceive — and one might correctly perceive — the cost of an additional year of high-income tax cuts is that you're really buying something more like $700 billion over the next decade than you're buying something like the $35 billion officially scored cost over the next year," he said.
Furman made the comments at an event sponsored by the Center for American Progress on how the tax code could work for working families.
The deputy director said temporary refundable provisions like the child tax credit and the college credit would be a tremendous help to families and that the Obama administration was working to make them permanent.
"That is something we're working to do and are optimistic that we're going to be able to get done," he said.
Furman also reiterated the president's position that Bush tax cuts for individuals earning more than $200,000 and couples making more than $250,000 a year should not be extended because they would do little to stimulate the economy.
"You have limited budgetary resources," he said. "You wouldn't want to use them to temporarily extend high-income tax cuts, which are extremely poor bang-for-the-buck economic stimulus."
He added that extending tax breaks for the wealthy tied for last in an analysis by the Congressional Budget Office on the best policies for economic growth.
"Out of 11 options, it tied for last," he said.