21-Jul-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0169
Incremental Effects of Allowing the 2001 and 2003 Tax Cuts to Sunset
Restore Marriage Penalties: Standard Deduction, Bottom Tax Brackets for Couples, and EITC Phaseout Threshold
Distribution of Federal Tax Change by Cash Income Percentile, 2012 1
Summary Table
Percent of Tax Units4
2,3
Cash Income Percentile
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average
Federal Tax
Change ($)
Average Federal Tax Rate6
Change (%
Points)
Under the
Proposal
0.0
0.0
0.0
0.0
0.0
0.0
2.4
15.6
23.7
39.3
70.5
25.9
0.0
-0.2
-0.2
-0.4
-0.4
-0.3
0.5
6.7
8.1
22.0
62.7
100.0
4
58
77
251
818
193
0.0
0.2
0.2
0.3
0.3
0.3
4.9
11.4
17.2
20.2
27.0
22.3
0.0
0.0
0.0
0.0
0.0
74.2
77.6
53.4
67.5
74.5
-0.8
-0.6
-0.2
-0.1
0.0
33.5
17.1
8.9
3.2
0.4
870
904
584
806
877
0.6
0.5
0.2
0.0
0.0
23.0
23.9
26.1
32.4
35.6
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-5).
Number of AMT Taxpayers (millions). Baseline: 3.7
Proposal: 2.9
** This table is part of a series of tables showing the distributional effects of moving incrementally from current policy to current law. For definitions and further
information, see “Related Tables: Moving Incrementally from Current Policy to Current Law” at
http://taxpolicycenter.org/numbers/displayatab.cfm?template=simulation&SimID=367
(1) Calendar year. Baseline is current policy (extension of the 2001-2003 tax cuts and patching AMT using 2009 parameters indexed for inflation) plus estate tax at
current law level— a 55 percent top tax rate and a $1 million exemption, not indexed); top two tax brackets raised to 36 and 39.6 percent; restoration of the personal
exemption phaseout (PEP) and the limitation on itemized deductions (Pease); increased tax rates on long-term capital gains (10 percent for tax units in 15 percent
bracket, 20 percent for rest) and reduced rates for gains on assets held 5 years or longer; taxation of all dividends as ordinary income; repeal of expansions of the student
loan interest deduction, the Earned Income Tax Credit (EITC), the Child and Dependent Care Tax Credit (CDCTC), and the Child Tax Credit (CTC). Policy is
restoration of marriage penalties by setting the standard deduction and 10 and 15 percent tax brackets for couples filing jointly to 1.67 times those for singles and
making the EITC phaseout threshold for couples filing jointly the same as that for singles.
(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) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax
units. The breaks are (in 2009 dollars): 20% $19,356, 40% $37,493, 60% $65,656, 80% $111,659, 90% $161,739, 95% $226,402, 99% $599,181, 99.9% $2,727,123.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) 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.
(6) 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.
21-Jul-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0169
Incremental Effects of Allowing the 2001 and 2003 Tax Cuts to Sunset
Restore Marriage Penalties: Standard Deduction, Bottom Tax Brackets for Couples, and EITC Phaseout Threshold
Distribution of Federal Tax Change by Cash Income Percentile, 2012 1
Detail Table
Percent of Tax Units4
Cash Income Percentile2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Percent
Share of Federal Taxes
Change (%
Points)
Under the
Proposal
Average Federal Tax Rate6
Change (%
Points)
Under the
Proposal
0.0
0.0
0.0
0.0
0.0
0.0
2.4
15.6
23.7
39.3
70.5
25.9
0.0
-0.2
-0.2
-0.4
-0.4
-0.3
0.5
6.7
8.1
22.0
62.7
100.0
4
58
77
251
818
193
0.7
1.8
0.9
1.4
1.1
1.2
0.0
0.0
0.0
0.1
0.0
0.0
0.8
4.3
10.7
17.9
66.1
100.0
0.0
0.2
0.2
0.3
0.3
0.3
4.9
11.4
17.2
20.2
27.0
22.3
0.0
0.0
0.0
0.0
0.0
74.2
77.6
53.4
67.5
74.5
-0.8
-0.6
-0.2
-0.1
0.0
33.5
17.1
8.9
3.2
0.4
870
904
584
806
877
2.8
2.0
0.7
0.1
0.0
0.2
0.1
-0.1
-0.3
-0.2
13.9
10.1
15.7
26.4
13.4
0.6
0.5
0.2
0.0
0.0
23.0
23.9
26.1
32.4
35.6
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile, 2012 1
Tax Units4
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Number
(thousands)
Percent of Total
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average AfterTax Income5
(Dollars)
Average
Federal Tax
Rate6
Share of PreTax Income
Share of PostTax Income
Share of
Federal Taxes
Percent of Total
Percent of Total
Percent of Total
38,450
34,947
31,868
26,646
23,298
157,348
24.4
22.2
20.3
16.9
14.8
100.0
11,600
28,852
52,224
88,978
280,229
76,169
562
3,230
8,901
17,704
74,929
16,773
11,038
25,622
43,323
71,273
205,300
59,395
4.9
11.2
17.0
19.9
26.7
22.0
3.7
8.4
13.9
19.8
54.5
100.0
4.5
9.6
14.8
20.3
51.2
100.0
0.8
4.3
10.8
17.9
66.1
100.0
11,720
5,734
4,655
1,190
120
7.5
3.6
3.0
0.8
0.1
138,385
196,549
345,574
1,825,188
8,367,274
30,884
46,028
89,592
590,735
2,973,782
107,501
150,520
255,983
1,234,453
5,393,492
22.3
23.4
25.9
32.4
35.5
13.5
9.4
13.4
18.1
8.4
13.5
9.2
12.8
15.7
6.9
13.7
10.0
15.8
26.6
13.5
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-5).
Number of AMT Taxpayers (millions). Baseline: 3.7
Proposal: 2.9
(1) Calendar year. Baseline is current policy (extension of the 2001-2003 tax cuts and patching AMT using 2009 parameters indexed for inflation) plus estate tax at current law level— a 55 percent top tax rate and a $1 million
exemption, not indexed); top two tax brackets raised to 36 and 39.6 percent; restoration of the personal exemption phaseout (PEP) and the limitation on itemized deductions (Pease); increased tax rates on long-term capital gains (10
percent for tax units in 15 percent bracket, 20 percent for rest) and reduced rates for gains on assets held 5 years or longer; taxation of all dividends as ordinary income; repeal of expansions of the student loan interest deduction, the
Earned Income Tax Credit (EITC), the Child and Dependent Care Tax Credit (CDCTC), and the Child Tax Credit (CTC). Policy is restoration of marriage penalties by setting the standard deduction and 10 and 15 percent tax brackets
for couples filing jointly to 1.67 times those for singles and making the EITC phaseout threshold for couples filing jointly the same as that for singles.
(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) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The breaks are (in 2009 dollars): 20% $19,356, 40%
$37,493, 60% $65,656, 80% $111,659, 90% $161,739, 95% $226,402, 99% $599,181, 99.9% $2,727,123.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) 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.
(6) 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.
21-Jul-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0169
Incremental Effects of Allowing the 2001 and 2003 Tax Cuts to Sunset
Restore Marriage Penalties: Standard Deduction, Bottom Tax Brackets for Couples, and EITC Phaseout Threshold
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 2012 1
Detail Table
4
Percent of Tax Units
Cash Income Percentile2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent
Change in
After-Tax
5
Income
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Share of Federal Taxes
Change (%
Points)
Percent
Under the
Proposal
Average Federal Tax Rate
Change (%
Points)
6
Under the
Proposal
0.0
0.0
0.0
0.0
0.0
0.0
5.2
18.2
20.7
34.8
54.7
25.9
-0.2
-0.3
-0.1
-0.4
-0.4
-0.3
2.2
7.4
5.5
22.6
62.3
100.0
21
69
54
229
633
193
10.1
2.7
0.7
1.5
1.0
1.2
0.0
0.1
0.0
0.1
-0.1
0.0
0.3
3.2
8.6
17.1
70.8
100.0
0.2
0.3
0.1
0.3
0.3
0.3
2.1
10.0
15.8
19.6
26.8
22.3
0.0
0.0
0.0
0.0
0.0
55.9
57.7
47.5
56.2
64.3
-0.7
-0.5
-0.3
-0.1
0.0
32.0
16.6
10.6
3.2
0.4
648
668
540
670
753
2.5
1.7
0.7
0.1
0.0
0.2
0.1
-0.1
-0.3
-0.2
15.1
11.3
17.0
27.4
13.9
0.6
0.4
0.2
0.0
0.0
22.8
24.0
25.9
32.2
35.3
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2012 1
4
Tax Units
2,3
Cash Income Percentile
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Number
(thousands)
Percent of
Total
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average After5
Tax Income
(Dollars)
Average
Federal Tax
6
Rate
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
31,706
32,349
31,237
29,980
29,936
157,348
20.2
20.6
19.9
19.1
19.0
100.0
10,935
26,208
46,322
77,565
235,547
76,169
206
2,539
7,274
14,984
62,482
16,773
10,729
23,669
39,048
62,581
173,066
59,395
1.9
9.7
15.7
19.3
26.5
22.0
2.9
7.1
12.1
19.4
58.8
100.0
3.6
8.2
13.1
20.1
55.4
100.0
0.3
3.1
8.6
17.0
70.9
100.0
15,019
7,540
5,940
1,436
142
9.6
4.8
3.8
0.9
0.1
117,658
167,170
294,212
1,584,726
7,360,192
26,177
39,369
75,653
509,009
2,595,251
91,481
127,801
218,559
1,075,717
4,764,942
22.3
23.6
25.7
32.1
35.3
14.7
10.5
14.6
19.0
8.7
14.7
10.3
13.9
16.5
7.3
14.9
11.3
17.0
27.7
14.0
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-5).
Number of AMT Taxpayers (millions). Baseline: 3.7
Proposal: 2.9
(1) Calendar year. Baseline is current policy (extension of the 2001-2003 tax cuts and patching AMT using 2009 parameters indexed for inflation) plus estate tax at current law level— a 55 percent top tax rate and a $1 million
exemption, not indexed); top two tax brackets raised to 36 and 39.6 percent; restoration of the personal exemption phaseout (PEP) and the limitation on itemized deductions (Pease); increased tax rates on long-term capital gains
(10 percent for tax units in 15 percent bracket, 20 percent for rest) and reduced rates for gains on assets held 5 years or longer; taxation of all dividends as ordinary income; repeal of expansions of the student loan interest
deduction, the Earned Income Tax Credit (EITC), the Child and Dependent Care Tax Credit (CDCTC), and the Child Tax Credit (CTC). Policy is restoration of marriage penalties by setting the standard deduction and 10 and 15
percent tax brackets for couples filing jointly to 1.67 times those for singles and making the EITC phaseout threshold for couples filing jointly the same as that for singles.
(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) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by dividing
by the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,219, 40% $24,782, 60% $41,864, 80% $68,188, 90% $97,830, 95% $138,709, 99% $361,983, 99.9%
$1,670,467.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) 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.
(6) 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.
21-Jul-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0169
Incremental Effects of Allowing the 2001 and 2003 Tax Cuts to Sunset
Restore Marriage Penalties: Standard Deduction, Bottom Tax Brackets for Couples, and EITC Phaseout Threshold
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 20121
Detail Table - Single Tax Units
Percent of Tax Units4
Cash Income Percentile2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Share of Federal Taxes
Change (%
Points)
Percent
Under the
Proposal
Average Federal Tax Rate6
Change (%
Points)
Under the
Proposal
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
-2.0
0.6
-22.3
19.5
100.0
100.0
0
0
0
0
0
0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
1.5
5.1
12.4
20.5
60.4
100.0
0.0
0.0
0.0
0.0
0.0
0.0
7.2
10.9
17.2
21.1
27.6
22.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
14.1
-19.5
-9.4
12.5
3.1
0
0
0
0
0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
15.4
10.8
14.5
19.8
9.5
0.0
0.0
0.0
0.0
0.0
24.0
25.3
26.3
34.3
38.1
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2012 1
Tax Units4
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average AfterTax Income5
(Dollars)
Number
(thousands)
Percent of Total
16,972
15,474
14,005
11,543
9,596
68,932
24.6
22.5
20.3
16.8
13.9
100.0
8,380
19,970
34,261
55,833
151,979
43,878
603
2,168
5,882
11,793
41,872
9,646
7,777
17,802
28,379
44,040
110,107
34,232
5,066
2,373
1,795
361
32
7.4
3.4
2.6
0.5
0.1
84,037
119,032
204,548
1,060,631
5,243,107
20,196
30,126
53,845
363,728
1,996,644
63,841
88,906
150,703
696,903
3,246,463
Share of PreTax Income
Share of PostTax Income
Share of
Federal Taxes
Percent of Total
Percent of Total
Percent of Total
7.2
10.9
17.2
21.1
27.6
22.0
4.7
10.2
15.9
21.3
48.2
100.0
5.6
11.7
16.8
21.5
44.8
100.0
1.5
5.1
12.4
20.5
60.4
100.0
24.0
25.3
26.3
34.3
38.1
14.1
9.3
12.1
12.7
5.5
13.7
8.9
11.5
10.7
4.4
15.4
10.8
14.5
19.8
9.5
Average
Federal Tax
Rate6
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-5).
(1) Calendar year. Baseline is current policy (extension of the 2001-2003 tax cuts and patching AMT using 2009 parameters indexed for inflation) plus estate tax at current law level— a 55 percent top tax rate and a $1 million
exemption, not indexed); top two tax brackets raised to 36 and 39.6 percent; restoration of the personal exemption phaseout (PEP) and the limitation on itemized deductions (Pease); increased tax rates on long-term capital gains (10
percent for tax units in 15 percent bracket, 20 percent for rest) and reduced rates for gains on assets held 5 years or longer; taxation of all dividends as ordinary income; repeal of expansions of the student loan interest deduction, the
Earned Income Tax Credit (EITC), the Child and Dependent Care Tax Credit (CDCTC), and the Child Tax Credit (CTC). Policy is restoration of marriage penalties by setting the standard deduction and 10 and 15 percent tax brackets
for couples filing jointly to 1.67 times those for singles and making the EITC phaseout threshold for couples filing jointly the same as that for singles.
(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) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by dividing by
the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,219, 40% $24,782, 60% $41,864, 80% $68,188, 90% $97,830, 95% $138,709, 99% $361,983, 99.9%
$1,670,467.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) 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.
(6) 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.
21-Jul-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0169
Incremental Effects of Allowing the 2001 and 2003 Tax Cuts to Sunset
Restore Marriage Penalties: Standard Deduction, Bottom Tax Brackets for Couples, and EITC Phaseout Threshold
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 20121
Detail Table - Married Tax Units Filing Jointly
Percent of Tax Units4
Cash Income Percentile2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Share of Federal Taxes
Change (%
Points)
Percent
Under the
Proposal
Average Federal Tax Rate6
Change (%
Points)
Under the
Proposal
0.0
0.0
0.0
0.0
0.0
0.0
23.2
61.9
52.5
66.1
85.9
63.6
-0.7
-0.8
-0.3
-0.6
-0.5
-0.5
2.2
7.4
5.3
22.1
62.9
100.0
99
245
138
438
1,005
484
30.1
7.9
1.6
2.5
1.4
1.7
0.0
0.1
0.0
0.1
-0.3
0.0
0.2
1.7
5.6
14.9
77.6
100.0
0.7
0.7
0.2
0.5
0.4
0.4
2.9
10.0
14.6
18.8
26.6
23.2
0.0
0.0
0.0
0.0
0.0
91.9
88.4
71.3
77.7
85.0
-1.0
-0.7
-0.3
-0.1
0.0
32.2
16.8
10.7
3.2
0.4
1,080
1,031
818
938
1,020
3.6
2.3
1.0
0.2
0.0
0.3
0.1
-0.1
-0.5
-0.3
15.2
12.2
18.9
31.3
15.6
0.8
0.5
0.2
0.1
0.0
22.3
23.5
25.8
31.6
34.7
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2012 1
Tax Units4
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average AfterTax Income5
(Dollars)
Number
(thousands)
Percent of Total
6,622
8,956
11,470
15,032
18,609
61,357
10.8
14.6
18.7
24.5
30.3
100.0
14,526
33,405
59,671
95,023
281,842
126,020
328
3,110
8,557
17,408
73,886
28,804
14,198
30,295
51,114
77,615
207,956
97,216
8,860
4,843
3,890
1,015
102
14.4
7.9
6.3
1.7
0.2
138,312
192,091
337,723
1,748,464
7,890,377
29,809
44,182
86,400
552,299
2,737,994
108,503
147,908
251,323
1,196,165
5,152,384
Share of PreTax Income
Share of PostTax Income
Share of
Federal Taxes
Percent of Total
Percent of Total
Percent of Total
2.3
9.3
14.3
18.3
26.2
22.9
1.2
3.9
8.9
18.5
67.8
100.0
1.6
4.6
9.8
19.6
64.9
100.0
0.1
1.6
5.6
14.8
77.8
100.0
21.6
23.0
25.6
31.6
34.7
15.9
12.0
17.0
23.0
10.5
16.1
12.0
16.4
20.4
8.8
14.9
12.1
19.0
31.7
15.9
Average
Federal Tax
Rate6
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-5).
(1) Calendar year. Baseline is current policy (extension of the 2001-2003 tax cuts and patching AMT using 2009 parameters indexed for inflation) plus estate tax at current law level— a 55 percent top tax rate and a $1 million
exemption, not indexed); top two tax brackets raised to 36 and 39.6 percent; restoration of the personal exemption phaseout (PEP) and the limitation on itemized deductions (Pease); increased tax rates on long-term capital gains (10
percent for tax units in 15 percent bracket, 20 percent for rest) and reduced rates for gains on assets held 5 years or longer; taxation of all dividends as ordinary income; repeal of expansions of the student loan interest deduction, the
Earned Income Tax Credit (EITC), the Child and Dependent Care Tax Credit (CDCTC), and the Child Tax Credit (CTC). Policy is restoration of marriage penalties by setting the standard deduction and 10 and 15 percent tax brackets
for couples filing jointly to 1.67 times those for singles and making the EITC phaseout threshold for couples filing jointly the same as that for singles.
(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) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by dividing by
the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,219, 40% $24,782, 60% $41,864, 80% $68,188, 90% $97,830, 95% $138,709, 99% $361,983, 99.9%
$1,670,467.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) 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.
(6) 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.
21-Jul-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0169
Incremental Effects of Allowing the 2001 and 2003 Tax Cuts to Sunset
Restore Marriage Penalties: Standard Deduction, Bottom Tax Brackets for Couples, and EITC Phaseout Threshold
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 20121
Detail Table - Head of Household Tax Units
Percent of Tax Units4
Cash Income Percentile2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Share of Federal Taxes
Change (%
Points)
Percent
Under the
Proposal
Average Federal Tax Rate6
Change (%
Points)
Under the
Proposal
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
1.7
10.1
18.0
7.6
-15.8
100.0
0
0
0
0
0
0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
-4.0
12.4
27.1
28.0
36.5
100.0
0.0
0.0
0.0
0.0
0.0
0.0
-5.9
8.3
16.2
20.1
25.3
15.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
3.4
0.4
5.8
0.0
2.0
0
0
0
0
0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
13.6
5.5
7.5
9.9
4.6
0.0
0.0
0.0
0.0
0.0
23.0
23.6
24.1
32.2
35.2
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2012 1
Tax Units4
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average AfterTax Income5
(Dollars)
Number
(thousands)
Percent of Total
7,840
7,497
5,095
2,777
1,242
24,547
31.9
30.5
20.8
11.3
5.1
100.0
13,490
30,617
50,275
76,881
178,521
41,760
-789
2,545
8,160
15,476
45,086
6,255
14,279
28,072
42,115
61,405
133,435
35,505
805
232
173
33
3
3.3
0.9
0.7
0.1
0.0
112,763
154,893
278,418
1,423,600
6,950,503
25,909
36,474
67,053
457,664
2,446,863
86,854
118,419
211,365
965,936
4,503,640
Share of PreTax Income
Share of PostTax Income
Share of
Federal Taxes
Percent of Total
Percent of Total
Percent of Total
-5.9
8.3
16.2
20.1
25.3
15.0
10.3
22.4
25.0
20.8
21.6
100.0
12.8
24.2
24.6
19.6
19.0
100.0
-4.0
12.4
27.1
28.0
36.5
100.0
23.0
23.6
24.1
32.2
35.2
8.9
3.5
4.7
4.6
2.0
8.0
3.2
4.2
3.7
1.5
13.6
5.5
7.5
9.9
4.6
Average
Federal Tax
Rate6
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-5).
(1) Calendar year. Baseline is current policy (extension of the 2001-2003 tax cuts and patching AMT using 2009 parameters indexed for inflation) plus estate tax at current law level— a 55 percent top tax rate and a $1 million
exemption, not indexed); top two tax brackets raised to 36 and 39.6 percent; restoration of the personal exemption phaseout (PEP) and the limitation on itemized deductions (Pease); increased tax rates on long-term capital gains (10
percent for tax units in 15 percent bracket, 20 percent for rest) and reduced rates for gains on assets held 5 years or longer; taxation of all dividends as ordinary income; repeal of expansions of the student loan interest deduction, the
Earned Income Tax Credit (EITC), the Child and Dependent Care Tax Credit (CDCTC), and the Child Tax Credit (CTC). Policy is restoration of marriage penalties by setting the standard deduction and 10 and 15 percent tax brackets
for couples filing jointly to 1.67 times those for singles and making the EITC phaseout threshold for couples filing jointly the same as that for singles.
(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) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by dividing by
the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,219, 40% $24,782, 60% $41,864, 80% $68,188, 90% $97,830, 95% $138,709, 99% $361,983, 99.9%
$1,670,467.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) 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.
(6) 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.
21-Jul-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0169
Incremental Effects of Allowing the 2001 and 2003 Tax Cuts to Sunset
Restore Marriage Penalties: Standard Deduction, Bottom Tax Brackets for Couples, and EITC Phaseout Threshold
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 2012 1
Detail Table - Tax Units with Children
4
Percent of Tax Units
Cash Income Percentile2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent
Change in
After-Tax
5
Income
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Share of Federal Taxes
Change (%
Points)
Percent
Under the
Proposal
Average Federal Tax Rate
Change (%
Points)
6
Under the
Proposal
0.0
0.0
0.0
0.0
0.0
0.0
11.5
31.6
31.3
51.7
73.7
38.3
-0.4
-0.5
-0.2
-0.6
-0.4
-0.4
4.1
12.1
6.4
30.2
47.3
100.0
59
171
91
452
836
299
-5.7
5.7
0.9
2.2
1.0
1.4
0.1
0.1
-0.1
0.2
-0.3
0.0
-0.9
3.2
10.3
19.9
67.5
100.0
0.4
0.5
0.2
0.4
0.3
0.3
-6.6
9.2
16.8
20.5
27.7
22.2
0.0
0.0
0.0
0.0
0.0
81.6
72.0
51.9
80.2
85.7
-0.8
-0.5
-0.2
-0.1
0.0
28.4
10.5
6.0
2.4
0.3
949
779
560
957
1,011
2.6
1.4
0.5
0.1
0.0
0.2
0.0
-0.2
-0.3
-0.2
15.6
10.4
16.3
25.2
12.1
0.6
0.4
0.1
0.1
0.0
23.5
24.4
27.2
33.6
35.7
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2012 1
4
Tax Units
2,3
Cash Income Percentile
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average After5
Tax Income
(Dollars)
Number
(thousands)
Percent of
Total
10,133
10,359
10,251
9,800
8,315
49,155
20.6
21.1
20.9
19.9
16.9
100.0
14,723
34,672
62,298
103,142
306,063
95,419
-1,027
3,027
10,370
20,723
83,803
20,923
15,750
31,646
51,928
82,418
222,260
74,496
4,398
1,976
1,567
374
36
9.0
4.0
3.2
0.8
0.1
157,496
224,546
400,356
2,088,455
9,839,694
36,016
54,000
108,142
701,160
3,515,091
121,480
170,546
292,214
1,387,295
6,324,603
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
-7.0
8.7
16.7
20.1
27.4
21.9
3.2
7.7
13.6
21.6
54.3
100.0
4.4
9.0
14.5
22.1
50.5
100.0
-1.0
3.1
10.3
19.8
67.8
100.0
22.9
24.1
27.0
33.6
35.7
14.8
9.5
13.4
16.7
7.6
14.6
9.2
12.5
14.2
6.2
15.4
10.4
16.5
25.5
12.3
Average
Federal Tax
6
Rate
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-5).
Note: Tax units with children are those claiming an exemption for children at home or away from home.
(1) Calendar year. Baseline is current policy (extension of the 2001-2003 tax cuts and patching AMT using 2009 parameters indexed for inflation) plus estate tax at current law level— a 55 percent top tax rate and a $1 million
exemption, not indexed); top two tax brackets raised to 36 and 39.6 percent; restoration of the personal exemption phaseout (PEP) and the limitation on itemized deductions (Pease); increased tax rates on long-term capital gains
(10 percent for tax units in 15 percent bracket, 20 percent for rest) and reduced rates for gains on assets held 5 years or longer; taxation of all dividends as ordinary income; repeal of expansions of the student loan interest
deduction, the Earned Income Tax Credit (EITC), the Child and Dependent Care Tax Credit (CDCTC), and the Child Tax Credit (CTC). Policy is restoration of marriage penalties by setting the standard deduction and 10 and 15
percent tax brackets for couples filing jointly to 1.67 times those for singles and making the EITC phaseout threshold for couples filing jointly the same as that for singles.
(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) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by dividing
by the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,219, 40% $24,782, 60% $41,864, 80% $68,188, 90% $97,830, 95% $138,709, 99% $361,983, 99.9%
$1,670,467.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) 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.
(6) 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.
21-Jul-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0169
Incremental Effects of Allowing the 2001 and 2003 Tax Cuts to Sunset
Restore Marriage Penalties: Standard Deduction, Bottom Tax Brackets for Couples, and EITC Phaseout Threshold
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 2012 1
Detail Table - Elderly Tax Units
4
Percent of Tax Units
Cash Income Percentile2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent
Change in
After-Tax
5
Income
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Share of Federal Taxes
Change (%
Points)
Percent
Under the
Proposal
Average Federal Tax Rate
Change (%
Points)
6
Under the
Proposal
0.0
0.0
0.0
0.0
0.0
0.0
1.3
13.0
19.2
41.0
52.7
24.5
0.0
-0.1
-0.1
-0.3
-0.3
-0.3
0.4
4.3
4.9
17.2
73.1
100.0
4
26
41
154
639
161
1.5
2.9
1.6
1.9
1.0
1.1
0.0
0.0
0.0
0.1
-0.1
0.0
0.3
1.7
3.5
10.2
84.2
100.0
0.0
0.1
0.1
0.2
0.3
0.2
2.6
4.0
6.3
11.8
26.0
19.3
0.0
0.0
0.0
0.0
0.0
53.2
57.7
50.1
43.3
59.2
-0.7
-0.6
-0.3
-0.1
0.0
31.3
19.9
17.3
4.6
0.6
634
716
609
525
698
3.6
2.4
0.9
0.1
0.0
0.2
0.1
0.0
-0.4
-0.2
10.1
9.5
20.6
44.1
22.2
0.6
0.5
0.2
0.0
0.0
17.5
20.3
24.6
32.4
35.8
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2012 1
4
Tax Units
2,3
Cash Income Percentile
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average After5
Tax Income
(Dollars)
Number
(thousands)
Percent of
Total
5,016
8,213
5,981
5,495
5,617
30,543
16.4
26.9
19.6
18.0
18.4
100.0
10,899
22,528
41,094
70,238
257,048
75,737
277
877
2,552
8,142
66,185
14,429
10,622
21,651
38,542
62,096
190,863
61,309
2,427
1,362
1,394
434
42
8.0
4.5
4.6
1.4
0.1
105,444
153,103
267,882
1,396,961
6,520,091
17,817
30,409
65,258
452,163
2,334,771
87,627
122,693
202,624
944,798
4,185,320
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
2.5
3.9
6.2
11.6
25.8
19.1
2.4
8.0
10.6
16.7
62.4
100.0
2.9
9.5
12.3
18.2
57.3
100.0
0.3
1.6
3.5
10.2
84.4
100.0
16.9
19.9
24.4
32.4
35.8
11.1
9.0
16.1
26.2
12.0
11.4
8.9
15.1
21.9
9.5
9.8
9.4
20.6
44.5
22.5
Average
Federal Tax
6
Rate
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-5).
Note: Elderly tax units are those with either head or spouse (if filing jointly) age 65 or older.
(1) Calendar year. Baseline is current policy (extension of the 2001-2003 tax cuts and patching AMT using 2009 parameters indexed for inflation) plus estate tax at current law level— a 55 percent top tax rate and a $1 million
exemption, not indexed); top two tax brackets raised to 36 and 39.6 percent; restoration of the personal exemption phaseout (PEP) and the limitation on itemized deductions (Pease); increased tax rates on long-term capital gains
(10 percent for tax units in 15 percent bracket, 20 percent for rest) and reduced rates for gains on assets held 5 years or longer; taxation of all dividends as ordinary income; repeal of expansions of the student loan interest
deduction, the Earned Income Tax Credit (EITC), the Child and Dependent Care Tax Credit (CDCTC), and the Child Tax Credit (CTC). Policy is restoration of marriage penalties by setting the standard deduction and 10 and 15
percent tax brackets for couples filing jointly to 1.67 times those for singles and making the EITC phaseout threshold for couples filing jointly the same as that for singles.
(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) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by dividing
by the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,219, 40% $24,782, 60% $41,864, 80% $68,188, 90% $97,830, 95% $138,709, 99% $361,983, 99.9%
$1,670,467.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) 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.
(6) 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.