26-Jun-06
Preliminary Results
http://www.taxpolicycenter.org
Table T06-0188
Equal-Cost Alternative Estate Tax Proposal with $11.75 Million Exemption and 45 Percent Rate
Baseline: H.R. 5638 As Amended and Passed by The House, The Permanent Estate Tax Relief Act of 2006
Distribution of Federal Tax Change by Cash Income Class, 2011 1
Cash Income Class
(thousands of 2005
2
dollars)
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 Tax
Cut
With Tax
Increase
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.1
0.2
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.1
0.0
Percent
Change in
After-Tax
Income4
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.1
0.1
-0.1
0.0
Share of
Total Federal
Tax Change
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
Average Federal Tax Change
Dollars
0
0
0
0
0
0
0
-3
-126
-398
2,196
0
Percent
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
-0.1
-0.2
0.2
0.0
Share of Federal Taxes
Change (%
Points)
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
Under the
Proposal
0.2
0.9
2.7
3.8
4.4
11.8
11.2
25.7
16.4
6.5
16.4
100.0
Average Federal Tax Rate5
Change (%
Points)
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
-0.1
0.1
0.0
Under the
Proposal
4.3
6.0
12.1
16.1
18.6
21.0
22.7
25.3
27.6
29.0
33.4
23.6
Baseline Distribution of Income and Federal Taxes
by Cash Income Class, 2011 1
Cash Income Class
(thousands of 2005
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 Units3
Number
(thousands)
17,076
24,604
22,025
16,710
13,168
22,575
14,102
18,722
5,166
825
423
155,984
Percent of
Total
11.0
15.8
14.1
10.7
8.4
14.5
9.0
12.0
3.3
0.5
0.3
100.0
Average
Income
(Dollars)
6,303
17,000
28,090
39,487
50,814
69,796
98,049
152,864
324,098
769,080
3,274,032
76,577
Average
Federal Tax
Burden
(Dollars)
270
1,022
3,394
6,359
9,424
14,653
22,279
38,653
89,561
223,352
1,090,284
18,049
Average
After-Tax
Income4
(Dollars)
6,033
15,978
24,695
33,128
41,390
55,143
75,770
114,211
234,537
545,728
2,183,747
58,528
Average
Federal Tax
Rate5
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
4.3
6.0
12.1
16.1
18.6
21.0
22.7
25.3
27.6
29.0
33.3
23.6
0.9
3.5
5.2
5.5
5.6
13.2
11.6
24.0
14.0
5.3
11.6
100.0
1.1
4.3
6.0
6.1
6.0
13.6
11.7
23.4
13.3
4.9
10.1
100.0
Share of
Federal Taxes
Percent of
Total
0.2
0.9
2.7
3.8
4.4
11.8
11.2
25.7
16.4
6.5
16.4
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0305-3A).
(1) Calendar year. Baseline is current law plus the following provisions in H.R. 5638: $5 million effective exemption indexed for inflation after 2010; statutory rate of 20 percent on taxable estate
between $5 million and $25 million and 40 percent on taxable estate greater than $25 million; repeal the state death tax credit (and do not allow a deduction for state estate taxes paid); repeal the 5percent surtax. Proposal would increase the exemption to $11.75 million and create a single statutory estate tax rate of 45 percent.
(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. Tax units that are dependents of other taxpayers are excluded from the analysis.
(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.