15-Jan-08
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T08-0008
Tax Benefits of Select Tax Expenditures for Economic Mobility
Distribution of Federal Tax Change by Cash Income Level, 2006 1
Summary Table
Cash Income Level
(thousands of 2006
dollars) 2
Less than 10
10-20
20-30
30-40
40-50
50-75
75-100
100-200
200-500
500-1,000
More than 1,000
All
Percent of Tax Units 3
With Benefit
28.3
53.8
67.2
72.2
73.1
83.0
92.0
96.5
98.2
98.6
98.9
69.3
Without
Benefit
71.7
46.2
32.8
27.8
26.9
17.0
8.1
3.5
1.8
1.4
1.1
30.7
Benefit as
Percent of
After-Tax
Income4
5.3
5.9
4.4
2.9
2.7
2.9
3.3
4.9
5.8
5.3
8.7
4.8
Share of Total
Benefits
1.6
6.1
5.6
3.8
3.4
8.7
8.2
22.9
14.8
5.4
19.7
100.0
Average
Benefit
287
837
991
880
994
1,456
2,282
5,063
12,370
26,163
181,946
2,398
Average Federal Tax Rate 5
With Benefits Without Benefits
3.9
4.5
9.8
14.0
16.6
18.5
20.0
22.4
25.6
27.7
32.5
21.3
9.0
10.1
13.8
16.6
18.8
20.8
22.6
26.2
29.9
31.6
38.4
25.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 1006-2).
Number of AMT Taxpayers (millions). Baseline:
3.6
Proposal:
2.9
(1) Calendar year. Baseline is current law. Alternative repeals the Hope and Lifetime Learning credits, the student loan interest deduction, the home mortgage interest
deduction, the state and local property tax deduction, the self-employed health insurance deduction, the earned income tax credit, the child and dependent care credit,
the preferential rates on capital gains and dividends, the partial exclusion for Social Security benefits, and the exclusions and deductions for IRAs, Keogh plans, and
defined contribution retirement savings plans.
(2) Tax units with negative cash income are excluded from the lowest income class but are included in the totals. For a description of cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(4) After-tax income is cash income less: individual income tax net of refundable credits; corporate income tax; payroll taxes (Social Security and Medicare); and
estate tax.
(5) Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, and the estate tax) as a percentage of average
cash income.
15-Jan-08
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T08-0008
Tax Benefits of Select Tax Expenditures for Economic Mobility
Distribution of Federal Tax Change by Cash Income Level, 2006
Detail Table
Cash Income Class
(thousands of 2006
dollars)2
Less than 10
10-20
20-30
30-40
40-50
50-75
75-100
100-200
200-500
500-1,000
More than 1,000
All
Percent of Tax Units3
With Benefit
Without
Benefit
28.3
53.8
67.2
72.2
73.1
83.0
92.0
96.5
98.2
98.6
98.9
69.3
71.7
46.2
32.8
27.8
26.9
17.0
8.1
3.5
1.8
1.4
1.1
30.7
Benefit as
Percent of
After-Tax
Income4
5.3
5.9
4.4
2.9
2.7
2.9
3.3
4.9
5.8
5.3
8.7
4.8
Share of Total
Benefits
1.6
6.1
5.6
3.8
3.4
8.7
8.2
22.9
14.8
5.4
19.7
100.0
Share of Federal Taxes
Average Benefit
Dollars
1
Average Federal Tax Rate5
As Percent of
Tax
With Benefits
Without
Benefits
129.2
125.2
41.0
18.0
13.4
12.8
13.3
16.8
16.8
13.9
18.2
17.6
0.2
0.9
2.4
3.7
4.4
11.9
10.9
24.0
15.5
6.8
19.1
100.0
0.4
1.6
2.9
3.7
4.3
11.4
10.5
23.8
15.4
6.6
19.2
100.0
Average
Federal Tax
Rate 5
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
1.1
4.1
5.2
5.6
5.7
13.7
11.7
22.7
12.9
5.2
12.5
100.0
1.4
4.9
6.0
6.1
6.0
14.2
11.8
22.4
12.2
4.8
10.8
100.0
0.2
0.9
2.4
3.7
4.4
11.9
10.9
24.0
15.5
6.8
19.1
100.0
287
837
991
880
994
1,456
2,282
5,063
12,370
26,163
181,946
2,398
With Benefits
3.9
4.5
9.8
14.0
16.6
18.5
20.0
22.4
25.6
27.7
32.5
21.3
Without
Benefits
9.0
10.1
13.8
16.6
18.8
20.8
22.6
26.2
29.9
31.6
38.4
25.0
Baseline Distribution of Income and Federal Taxes
by Cash Income Level, 2006 1
Cash Income Level
(thousands of 2006
dollars) 2
Less than 10
10-20
20-30
30-40
40-50
50-75
75-100
100-200
200-500
500-1,000
More than 1,000
All
Tax Units 3
Number
(thousands)
19,138
25,619
19,881
15,077
11,930
21,009
12,719
15,955
4,214
727
383
147,237
Percent of
Total
13.0
17.4
13.5
10.2
8.1
14.3
8.6
10.8
2.9
0.5
0.3
100.0
Average
Income
(Dollars)
5,634
14,909
24,735
34,840
44,708
61,462
86,239
134,074
287,808
677,545
3,081,101
63,974
Average
Federal Tax
Burden
(Dollars)
222
669
2,416
4,886
7,411
11,352
17,225
30,075
73,612
187,950
1,000,082
13,603
Average AfterTax Income 4
(Dollars)
5,411
14,240
22,320
29,954
37,297
50,110
69,013
103,999
214,195
489,595
2,081,020
50,371
3.9
4.5
9.8
14.0
16.6
18.5
20.0
22.4
25.6
27.7
32.5
21.3
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 1006-2).
Number of AMT Taxpayers (millions). Baseline:
3.6
Proposal:
2.9
(1) Calendar year. Baseline is current law. Alternative repeals the Hope and Lifetime Learning credits, the student loan interest deduction, the home mortgage interest deduction, the state and local property tax deduction, the
self-employed health insurance deduction, the earned income tax credit, the child and dependent care credit, the preferential rates on capital gains and dividends, the partial exclusion for Social Security benefits, and the
exclusions and deductions for IRAs, Keogh plans, and defined contribution retirement savings plans.
(2) Tax units with negative cash income are excluded from the lowest income class but are included in the totals. For a description of cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(4) After-tax income is cash income less: individual income tax net of refundable credits; corporate income tax; payroll taxes (Social Security and Medicare); and estate tax.
(5) Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, and the estate tax) as a percentage of average cash income.