29-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Click on PDF or Excel link above for additional tables containing more detail and breakdowns by filing status and demographic groups.
Table T09-0302
Administration's Fiscal Year 2010 Budget Proposals
Extend the Making Work Pay Credit, Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Administration Baseline
Distribution of Federal Tax Change by Cash Income Level, 2012 1
Summary Table
Cash Income Level
(thousands of 2009
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 Tax Cut
66.9
65.7
75.3
82.2
84.8
87.2
89.0
80.1
35.4
19.4
14.5
75.8
With Tax
Increase
0.0
0.2
0.2
0.2
0.0
0.1
0.3
0.3
0.0
0.0
0.0
0.2
Percent Change
in After-Tax
Income 4
5.8
3.6
2.5
2.0
1.6
1.3
1.0
0.7
0.1
0.0
0.0
1.0
Share of Total
Federal Tax
Change
5.7
14.0
13.5
11.1
8.9
17.0
11.2
16.5
1.5
0.2
0.1
100.0
Average
Federal Tax
Change ($)
-312
-534
-591
-634
-639
-691
-716
-731
-233
-215
-240
-586
Average Federal Tax Rate 5
Change (%
Points)
-5.5
-3.5
-2.3
-1.8
-1.4
-1.1
-0.8
-0.5
-0.1
0.0
0.0
-0.8
Under the
Proposal
-0.1
1.1
6.5
11.1
14.0
16.4
18.4
21.1
24.1
25.4
29.6
19.9
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-1).
Number of AMT Taxpayers (millions). Baseline: 5.1
Proposal: 5.0
(1) Calendar year. Administration baseline extends the 2009 AMT patch and indexes the AMT exemption, rate bracket threshold, and phaseout exemption threshold for
inflation; makes the 2001 and 2003 individual income tax cuts permanent and makes 2009 estate tax law permanent. Proposal would: (a) extend the Making Work Pay
Credit, reduce the phase-out rate to 1.6 percent, and index the phase-out thesholds for inflation after 2010; (b) extend the higher EITC credit value for families with 3
children and higher phase-out threshold for married couples; (c) modify the saver's credit making it equal to 50% of the first $500 of retirement savings ($1,000 for
couples) and fully refundable; (d) create automatic 401(k)s and IRAs; (e) extend the American Opportunity Tax Credit; (f) extend the $3,000 child tax credit
refundability threshold.
(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.
29-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0302
Administration's Fiscal Year 2010 Budget Proposals
Extend the Making Work Pay Credit, Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Administration Baseline
1
Distribution of Federal Tax Change by Cash Income Level, 2012
Detail Table
Cash Income Level
(thousands of 2009
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
With Tax Cut
3
With Tax
Increase
66.9
65.7
75.3
82.2
84.8
87.2
89.0
80.1
35.4
19.4
14.5
75.8
0.0
0.2
0.2
0.2
0.0
0.1
0.3
0.3
0.0
0.0
0.0
0.2
Percent Change
in After-Tax
Income 4
Share of Total
Federal Tax
Change
5.8
3.6
2.5
2.0
1.6
1.3
1.0
0.7
0.1
0.0
0.0
1.0
5.7
14.0
13.5
11.1
8.9
17.0
11.2
16.5
1.5
0.2
0.1
100.0
Average Federal Tax Change
Dollars
-312
-534
-591
-634
-639
-691
-716
-731
-233
-215
-240
-586
Percent
-102.5
-75.1
-26.3
-13.7
-9.0
-6.2
-4.2
-2.4
-0.3
-0.1
0.0
-3.7
Share of Federal Taxes
Change (%
Points)
-0.2
-0.5
-0.5
-0.3
-0.2
-0.3
-0.1
0.4
0.6
0.3
0.8
0.0
Under the
Proposal
0.0
0.2
1.5
2.7
3.5
10.0
10.0
25.8
17.8
7.9
20.5
100.0
Average Federal Tax Rate 5
Change (%
Points)
-5.5
-3.5
-2.3
-1.8
-1.4
-1.1
-0.8
-0.5
-0.1
0.0
0.0
-0.8
Under the
Proposal
-0.1
1.1
6.5
11.1
14.0
16.4
18.4
21.1
24.1
25.4
29.6
19.9
Baseline Distribution of Income and Federal Taxes
1
by Cash Income Level, 2012
Cash Income Level
(thousands of 2009
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)
16,867
24,202
21,129
16,119
12,811
22,730
14,433
20,762
5,989
1,052
533
157,348
Percent of
Total
10.7
15.4
13.4
10.2
8.1
14.5
9.2
13.2
3.8
0.7
0.3
100.0
Average
Income
(Dollars)
5,698
15,471
25,711
36,076
46,449
63,828
89,794
140,646
294,838
703,124
3,105,866
76,169
Average
Federal Tax
Burden
(Dollars)
305
710
2,250
4,637
7,131
11,176
17,198
30,389
71,232
178,856
919,118
15,744
Average AfterTax Income 4
(Dollars)
5,393
14,761
23,461
31,438
39,319
52,652
72,596
110,257
223,607
524,267
2,186,748
60,424
Average
Federal Tax
Rate 5
5.4
4.6
8.8
12.9
15.4
17.5
19.2
21.6
24.2
25.4
29.6
20.7
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
0.8
3.1
4.5
4.9
5.0
12.1
10.8
24.4
14.7
6.2
13.8
100.0
1.0
3.8
5.2
5.3
5.3
12.6
11.0
24.1
14.1
5.8
12.3
100.0
0.2
0.7
1.9
3.0
3.7
10.3
10.0
25.5
17.2
7.6
19.8
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-1).
Number of AMT Taxpayers (millions). Baseline: 5.1
Proposal: 5.0
(1) Calendar year. Administration baseline extends the 2009 AMT patch and indexes the AMT exemption, rate bracket threshold, and phaseout exemption threshold for inflation; makes the 2001 and 2003 individual income tax
cuts permanent and makes 2009 estate tax law permanent. Proposal would: (a) extend the Making Work Pay Credit, reduce the phase-out rate to 1.6 percent, and index the phase-out thesholds for inflation after 2010; (b) extend
the higher EITC credit value for families with 3 children and higher phase-out threshold for married couples; (c) modify the saver's credit making it equal to 50% of the first $500 of retirement savings ($1,000 for couples) and fully
refundable; (d) create automatic 401(k)s and IRAs; (e) extend the American Opportunity Tax Credit; (f) extend the $3,000 child tax credit refundability threshold.
(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.
29-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0302
Administration's Fiscal Year 2010 Budget Proposals
Extend the Making Work Pay Credit, Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Administration Baseline
Distribution of Federal Tax Change by Cash Income Level, 2012 1
Detail Table - Single Tax Units
Cash Income Level
(thousands of 2009
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 Tax
Increase
With Tax Cut
66.6
57.2
70.4
80.7
83.9
84.5
83.4
31.1
9.7
10.1
4.8
68.7
0.0
0.3
0.1
0.0
0.0
0.0
0.0
0.0
0.0
0.1
0.0
0.1
Percent Change
in After-Tax
Income 4
5.1
2.2
1.7
1.6
1.1
0.9
0.6
0.1
0.0
0.0
0.0
1.0
Share of Total
Federal Tax
Change
13.3
19.4
18.0
14.8
10.6
16.0
5.7
1.7
0.3
0.0
0.0
100.0
Average Federal Tax Change
Dollars
-265
-313
-386
-468
-426
-434
-378
-120
-80
-76
-69
-348
Percent
-54.9
-24.4
-11.5
-7.5
-4.8
-3.2
-1.8
-0.4
-0.1
0.0
0.0
-3.8
Share of Federal Taxes
Change (%
Points)
-0.5
-0.7
-0.5
-0.3
-0.1
0.1
0.3
0.7
0.4
0.2
0.5
0.0
Under the
Proposal
0.4
2.4
5.5
7.2
8.3
19.0
12.3
18.7
9.8
4.4
11.9
100.0
Average Federal Tax Rate5
Change (%
Points)
-4.7
-2.0
-1.5
-1.3
-0.9
-0.7
-0.4
-0.1
0.0
0.0
0.0
-0.8
Under the
Proposal
3.8
6.4
11.7
16.0
18.2
20.8
23.2
24.2
25.1
27.5
32.4
20.1
Baseline Distribution of Income and Federal Taxes
by Cash Income Level, 2012 1
Cash Income Level
(thousands of 2009
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)
Percent of
Total
12,093
14,849
11,214
7,581
5,967
8,814
3,630
3,425
789
138
75
68,932
17.5
21.5
16.3
11.0
8.7
12.8
5.3
5.0
1.1
0.2
0.1
100.0
Average
Income
(Dollars)
5,684
15,322
25,573
36,006
46,386
62,955
88,784
136,925
299,674
695,858
2,961,621
43,878
Average
Federal Tax
Burden
(Dollars)
482
1,286
3,371
6,225
8,879
13,521
20,931
33,201
75,425
191,298
958,491
9,146
Average AfterTax Income 4
(Dollars)
5,203
14,036
22,202
29,781
37,507
49,433
67,854
103,724
224,249
504,560
2,003,130
34,731
Average
Federal Tax
Rate 5
8.5
8.4
13.2
17.3
19.1
21.5
23.6
24.3
25.2
27.5
32.4
20.8
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
2.3
7.5
9.5
9.0
9.2
18.4
10.7
15.5
7.8
3.2
7.4
100.0
2.6
8.7
10.4
9.4
9.4
18.2
10.3
14.8
7.4
2.9
6.3
100.0
0.9
3.0
6.0
7.5
8.4
18.9
12.1
18.0
9.4
4.2
11.4
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-1).
(1) Calendar year. Administration baseline extends the 2009 AMT patch and indexes the AMT exemption, rate bracket threshold, and phaseout exemption threshold for inflation; makes the 2001 and 2003 individual income tax
cuts permanent and makes 2009 estate tax law permanent. Proposal would: (a) extend the Making Work Pay Credit, reduce the phase-out rate to 1.6 percent, and index the phase-out thesholds for inflation after 2010; (b) extend
the higher EITC credit value for families with 3 children and higher phase-out threshold for married couples; (c) modify the saver's credit making it equal to 50% of the first $500 of retirement savings ($1,000 for couples) and
fully refundable; (d) create automatic 401(k)s and IRAs; (e) extend the American Opportunity Tax Credit; (f) extend the $3,000 child tax credit refundability threshold.
(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.
29-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0302
Administration's Fiscal Year 2010 Budget Proposals
Extend the Making Work Pay Credit, Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Administration Baseline
Distribution of Federal Tax Change by Cash Income Level, 2012 1
Detail Table - Married Tax Units Filing Jointly
Cash Income Level
(thousands of 2009
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 Tax
Increase
With Tax Cut
50.1
66.2
67.3
71.6
78.1
85.9
90.0
92.9
40.5
21.2
16.5
77.6
0.0
0.0
0.0
0.3
0.1
0.1
0.4
0.4
0.0
0.0
0.0
0.2
Percent Change
in After-Tax
Income 4
5.9
4.9
3.5
2.7
2.3
1.7
1.2
0.8
0.1
0.1
0.0
0.8
Share of Total
Federal Tax
Change
1.2
6.3
8.4
7.9
8.0
18.9
16.3
29.5
2.6
0.4
0.2
100.0
Average Federal Tax Change
Dollars
-267
-764
-862
-889
-979
-949
-884
-895
-260
-239
-277
-807
Percent
-116.8
-173.3
-73.8
-32.5
-20.4
-10.4
-5.7
-3.0
-0.4
-0.1
0.0
-3.0
Share of Federal Taxes
Change (%
Points)
0.0
-0.2
-0.3
-0.2
-0.2
-0.4
-0.2
0.0
0.6
0.3
0.7
0.0
Under the
Proposal
0.0
-0.1
0.1
0.5
1.0
5.0
8.3
29.3
21.9
9.7
24.3
100.0
Average Federal Tax Rate5
Change (%
Points)
-5.6
-4.8
-3.3
-2.5
-2.1
-1.5
-1.0
-0.6
-0.1
0.0
0.0
-0.6
Under the
Proposal
-0.8
-2.0
1.2
5.1
8.2
12.6
16.2
20.3
23.9
25.1
29.1
20.8
Baseline Distribution of Income and Federal Taxes
by Cash Income Level, 2012 1
Cash Income Level
(thousands of 2009
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)
Percent of
Total
2,164
4,064
4,828
4,406
4,057
9,840
9,114
16,285
4,998
880
437
61,357
3.5
6.6
7.9
7.2
6.6
16.0
14.9
26.5
8.2
1.4
0.7
100.0
Average
Income
(Dollars)
4,748
15,973
25,857
36,192
46,612
64,984
90,400
141,926
294,061
704,704
3,067,872
126,020
Average
Federal Tax
Burden
(Dollars)
228
441
1,168
2,739
4,804
9,109
15,516
29,768
70,524
177,065
892,687
26,988
Average AfterTax Income 4
(Dollars)
4,520
15,532
24,689
33,453
41,808
55,874
74,885
112,159
223,537
527,638
2,175,185
99,032
Average
Federal Tax
Rate 5
4.8
2.8
4.5
7.6
10.3
14.0
17.2
21.0
24.0
25.1
29.1
21.4
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
0.1
0.8
1.6
2.1
2.5
8.3
10.7
29.9
19.0
8.0
17.3
100.0
0.2
1.0
2.0
2.4
2.8
9.1
11.2
30.1
18.4
7.6
15.6
100.0
0.0
0.1
0.3
0.7
1.2
5.4
8.5
29.3
21.3
9.4
23.5
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-1).
(1) Calendar year. Administration baseline extends the 2009 AMT patch and indexes the AMT exemption, rate bracket threshold, and phaseout exemption threshold for inflation; makes the 2001 and 2003 individual income tax
cuts permanent and makes 2009 estate tax law permanent. Proposal would: (a) extend the Making Work Pay Credit, reduce the phase-out rate to 1.6 percent, and index the phase-out thesholds for inflation after 2010; (b) extend
the higher EITC credit value for families with 3 children and higher phase-out threshold for married couples; (c) modify the saver's credit making it equal to 50% of the first $500 of retirement savings ($1,000 for couples) and
fully refundable; (d) create automatic 401(k)s and IRAs; (e) extend the American Opportunity Tax Credit; (f) extend the $3,000 child tax credit refundability threshold.
(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.
29-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0302
Administration's Fiscal Year 2010 Budget Proposals
Extend the Making Work Pay Credit, Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Administration Baseline
Distribution of Federal Tax Change by Cash Income Level, 2012 1
Detail Table - Head of Household Tax Units
Cash Income Level
(thousands of 2009
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 Tax
Increase
With Tax Cut
82.8
89.1
93.7
96.4
96.7
96.6
96.5
41.6
11.1
14.8
5.5
90.3
0.0
0.0
0.7
0.2
0.0
0.0
0.0
0.0
0.0
0.2
0.0
0.2
Percent Change
in After-Tax
Income 4
8.3
6.2
3.2
2.1
1.6
1.3
0.8
0.2
0.1
0.0
0.0
2.0
Share of Total
Federal Tax
Change
8.2
28.3
21.5
14.6
8.5
13.2
4.5
1.0
0.2
0.0
0.0
100.0
Average Federal Tax Change
Dollars
Percent
-591
-1,008
-807
-688
-620
-655
-573
-191
-217
-176
-87
-726
114.8
116.0
-146.0
-19.9
-9.6
-6.1
-3.2
-0.6
-0.3
-0.1
0.0
-12.7
Share of Federal Taxes
Change (%
Points)
-1.3
-4.5
-2.9
-0.8
0.4
2.1
1.9
2.7
1.1
0.4
1.0
0.0
Under the
Proposal
-2.2
-7.6
-1.0
8.5
11.6
29.5
19.7
21.9
8.5
3.2
7.9
100.0
Average Federal Tax Rate5
Change (%
Points)
-8.9
-6.5
-3.1
-1.9
-1.3
-1.0
-0.7
-0.1
-0.1
0.0
0.0
-1.7
Under the
Proposal
-16.7
-12.1
-1.0
7.7
12.6
16.1
19.5
22.7
23.7
24.1
30.0
12.0
Baseline Distribution of Income and Federal Taxes
by Cash Income Level, 2012 1
Cash Income Level
(thousands of 2009
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)
Percent of
Total
2,467
4,998
4,757
3,777
2,442
3,577
1,399
895
150
24
11
24,547
10.1
20.4
19.4
15.4
10.0
14.6
5.7
3.7
0.6
0.1
0.0
100.0
Average
Income
(Dollars)
6,622
15,513
25,869
36,040
46,392
62,829
88,811
132,422
294,067
684,765
2,969,130
41,760
Average
Federal Tax
Burden
(Dollars)
-515
-869
552
3,462
6,461
10,781
17,891
30,299
69,939
164,861
891,050
5,737
Average AfterTax Income 4
(Dollars)
7,137
16,382
25,316
32,578
39,932
52,047
70,920
102,123
224,127
519,904
2,078,079
36,023
Average
Federal Tax
Rate 5
-7.8
-5.6
2.1
9.6
13.9
17.2
20.1
22.9
23.8
24.1
30.0
13.7
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
1.6
7.6
12.0
13.3
11.1
21.9
12.1
11.6
4.3
1.6
3.2
100.0
2.0
9.3
13.6
13.9
11.0
21.1
11.2
10.3
3.8
1.4
2.6
100.0
-0.9
-3.1
1.9
9.3
11.2
27.4
17.8
19.3
7.5
2.8
6.9
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-1).
(1) Calendar year. Administration baseline extends the 2009 AMT patch and indexes the AMT exemption, rate bracket threshold, and phaseout exemption threshold for inflation; makes the 2001 and 2003 individual income tax
cuts permanent and makes 2009 estate tax law permanent. Proposal would: (a) extend the Making Work Pay Credit, reduce the phase-out rate to 1.6 percent, and index the phase-out thesholds for inflation after 2010; (b) extend
the higher EITC credit value for families with 3 children and higher phase-out threshold for married couples; (c) modify the saver's credit making it equal to 50% of the first $500 of retirement savings ($1,000 for couples) and
fully refundable; (d) create automatic 401(k)s and IRAs; (e) extend the American Opportunity Tax Credit; (f) extend the $3,000 child tax credit refundability threshold.
(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.
29-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0302
Administration's Fiscal Year 2010 Budget Proposals
Extend the Making Work Pay Credit, Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Administration Baseline
1
Distribution of Federal Tax Change by Cash Income Level, 2012
Detail Table - Tax Units with Children
Cash Income Level
(thousands of 2009
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
With Tax Cut
3
With Tax
Increase
83.1
96.4
97.6
98.7
98.7
98.8
98.3
94.2
39.3
18.6
14.1
92.0
0.0
0.0
0.4
0.0
0.0
0.0
0.6
0.6
0.1
0.0
0.1
0.3
Percent Change
in After-Tax
Income 4
8.9
7.3
4.3
3.1
2.5
1.9
1.3
0.9
0.1
0.1
0.0
1.3
Share of Total
Federal Tax
Change
3.9
14.8
13.5
10.5
8.4
15.6
11.6
19.4
1.7
0.2
0.1
100.0
Average Federal Tax Change
Dollars
Percent
-620
-1,255
-1,127
-1,022
-1,036
-1,000
-949
-980
-296
-257
-297
-966
85.9
86.1
656.3
-37.1
-17.9
-10.0
-5.8
-3.3
-0.4
-0.1
0.0
-5.0
Share of Federal Taxes
Change (%
Points)
-0.2
-0.8
-0.7
-0.5
-0.3
-0.4
-0.1
0.5
1.0
0.5
1.1
0.0
Average Federal Tax Rate 5
Under the
Proposal
Change (%
Points)
Under the
Proposal
-0.4
-1.7
-0.8
0.9
2.0
7.4
9.9
29.9
22.0
9.2
21.5
100.0
-10.0
-8.0
-4.4
-2.8
-2.2
-1.6
-1.1
-0.7
-0.1
0.0
0.0
-1.0
-21.6
-17.3
-5.0
4.8
10.2
14.0
17.0
20.4
24.4
26.6
30.3
19.3
Baseline Distribution of Income and Federal Taxes
1
by Cash Income Level, 2012
Cash Income Level
(thousands of 2009
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)
Percent of
Total
2,948
5,596
5,687
4,892
3,846
7,413
5,821
9,378
2,778
445
207
49,155
6.0
11.4
11.6
10.0
7.8
15.1
11.8
19.1
5.7
0.9
0.4
100.0
Average
Income
(Dollars)
6,225
15,695
25,809
36,039
46,542
64,136
90,376
141,540
292,361
702,705
3,097,146
95,419
Average
Federal Tax
Burden
(Dollars)
-722
-1,458
-172
2,754
5,774
10,006
16,297
29,821
71,682
187,184
937,935
19,342
Average AfterTax Income 4
(Dollars)
6,947
17,153
25,980
33,285
40,768
54,130
74,078
111,719
220,679
515,521
2,159,211
76,077
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
-11.6
-9.3
-0.7
7.6
12.4
15.6
18.0
21.1
24.5
26.6
30.3
20.3
0.4
1.9
3.1
3.8
3.8
10.1
11.2
28.3
17.3
6.7
13.7
100.0
0.6
2.6
4.0
4.4
4.2
10.7
11.5
28.0
16.4
6.1
12.0
100.0
-0.2
-0.9
-0.1
1.4
2.3
7.8
10.0
29.4
20.9
8.8
20.4
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-1).
Note: Tax units with children are those claiming an exemption for children at home or away from home.
(1) Calendar year. Administration baseline extends the 2009 AMT patch and indexes the AMT exemption, rate bracket threshold, and phaseout exemption threshold for inflation; makes the 2001 and 2003 individual income tax
cuts permanent and makes 2009 estate tax law permanent. Proposal would: (a) extend the Making Work Pay Credit, reduce the phase-out rate to 1.6 percent, and index the phase-out thesholds for inflation after 2010; (b) extend
the higher EITC credit value for families with 3 children and higher phase-out threshold for married couples; (c) modify the saver's credit making it equal to 50% of the first $500 of retirement savings ($1,000 for couples) and fully
refundable; (d) create automatic 401(k)s and IRAs; (e) extend the American Opportunity Tax Credit; (f) extend the $3,000 child tax credit refundability threshold.
(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.
29-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0302
Administration's Fiscal Year 2010 Budget Proposals
Extend the Making Work Pay Credit, Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Administration Baseline
1
Distribution of Federal Tax Change by Cash Income Level, 2012
Detail Table - Elderly Tax Units
Cash Income Level
(thousands of 2009
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
With Tax Cut
3
With Tax
Increase
15.6
14.1
23.3
27.7
29.8
44.3
47.9
43.2
23.5
17.2
12.4
28.6
0.0
0.1
0.0
0.1
0.0
0.1
0.0
0.2
0.0
0.0
0.0
0.1
Percent Change
in After-Tax
Income 4
0.9
0.4
0.5
0.4
0.4
0.5
0.4
0.3
0.1
0.0
0.0
0.3
Share of Total
Federal Tax
Change
2.3
8.1
11.4
8.5
7.5
24.9
15.8
17.4
2.8
0.7
0.5
100.0
Average Federal Tax Change
Dollars
-52
-64
-115
-143
-170
-289
-322
-295
-126
-137
-209
-167
Percent
-26.7
-16.6
-10.4
-6.7
-5.6
-4.5
-2.8
-1.2
-0.2
-0.1
0.0
-1.3
Share of Federal Taxes
Change (%
Points)
0.0
-0.1
-0.1
-0.1
-0.1
-0.2
-0.1
0.0
0.2
0.1
0.4
0.0
Under the
Proposal
0.1
0.5
1.3
1.5
1.7
6.9
7.2
19.0
19.4
10.9
31.3
100.0
Average Federal Tax Rate 5
Change (%
Points)
-0.8
-0.4
-0.5
-0.4
-0.4
-0.5
-0.4
-0.2
0.0
0.0
0.0
-0.2
Under the
Proposal
2.3
2.1
3.9
5.6
6.2
9.6
12.8
17.5
22.2
24.5
30.1
17.0
Baseline Distribution of Income and Federal Taxes
1
by Cash Income Level, 2012
Cash Income Level
(thousands of 2009
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)
Percent of
Total
2,290
6,436
5,081
3,028
2,243
4,407
2,503
3,022
1,130
246
132
30,543
7.5
21.1
16.6
9.9
7.3
14.4
8.2
9.9
3.7
0.8
0.4
100.0
Average
Income
(Dollars)
6,340
15,603
25,455
35,926
46,389
64,259
88,731
141,022
303,653
708,629
3,089,249
75,737
Average
Federal Tax
Burden
(Dollars)
196
388
1,101
2,137
3,061
6,438
11,670
25,008
67,620
173,400
928,588
13,011
Average AfterTax Income 4
(Dollars)
6,144
15,216
24,354
33,788
43,328
57,820
77,061
116,014
236,033
535,230
2,160,661
62,726
Average
Federal Tax
Rate 5
3.1
2.5
4.3
6.0
6.6
10.0
13.2
17.7
22.3
24.5
30.1
17.2
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
0.6
4.3
5.6
4.7
4.5
12.2
9.6
18.4
14.8
7.5
17.7
100.0
0.7
5.1
6.5
5.3
5.1
13.3
10.1
18.3
13.9
6.9
14.9
100.0
0.1
0.6
1.4
1.6
1.7
7.1
7.4
19.0
19.2
10.7
30.9
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-1).
Note: Elderly tax units are those with either head or spouse (if filing jointly) age 65 or older.
(1) Calendar year. Administration baseline extends the 2009 AMT patch and indexes the AMT exemption, rate bracket threshold, and phaseout exemption threshold for inflation; makes the 2001 and 2003 individual income tax
cuts permanent and makes 2009 estate tax law permanent. Proposal would: (a) extend the Making Work Pay Credit, reduce the phase-out rate to 1.6 percent, and index the phase-out thesholds for inflation after 2010; (b) extend
the higher EITC credit value for families with 3 children and higher phase-out threshold for married couples; (c) modify the saver's credit making it equal to 50% of the first $500 of retirement savings ($1,000 for couples) and fully
refundable; (d) create automatic 401(k)s and IRAs; (e) extend the American Opportunity Tax Credit; (f) extend the $3,000 child tax credit refundability threshold.
(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.