4‐Aug‐11
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T11‐0261
Tax Benefits of the American Opportunity Tax Credit, Lifetime Learning Credit, Tuition and Fees Deduction and the Student Loan Interest Deduction
Baseline: Current Law
Distribution of Federal Tax Change by Cash Income Percentile, 2011 1
Detail Table
Percent of Tax Units4
Cash Income Percentile 2,3
Without Benefit
With Benefit
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Benefit as Percent of After‐Tax Income5
Average Benefit
Share of Total Benefits
Dollars
Share of Federal Taxes
Percent of Tax
With Credits and Deductions
Without Credits and Deductions
Average Federal Tax Rate6
With Credits and Deductions
Without Credits and Deductions
6.8
10.6
14.5
18.1
14.7
12.1
93.2
89.4
85.6
81.9
85.3
87.9
0.6
0.4
0.4
0.3
0.1
0.2
11.3
17.6
22.8
26.4
21.7
100.0
54
100
148
207
196
128
71.0
7.0
2.6
1.6
0.3
1.1
0.2
2.7
9.3
18.2
69.5
100.0
0.3
2.9
9.5
18.3
69.0
100.0
0.8
5.8
12.5
16.6
23.1
18.1
1.4
6.2
12.9
16.8
23.1
18.3
21.7
13.3
2.3
1.0
0.1
78.4
86.7
97.7
99.1
99.9
0.3
0.1
0.0
0.0
0.0
15.7
5.3
0.7
0.1
0.0
280
196
31
9
1
1.1
0.5
0.0
0.0
0.0
15.1
11.3
17.5
25.6
13.1
15.2
11.3
17.3
25.3
13.0
19.2
21.1
23.0
27.6
30.8
19.4
21.2
23.0
27.6
30.8
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, 2011 1
Tax Units4
Cash Income Percentile 2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Number (thousands)
Pre‐Tax Income
Percent of Total
Average (dollars)
43,661
36,819
32,344
26,761
23,243
163,869
26.6
22.5
19.7
16.3
14.2
100.0
9,187
24,603
44,639
79,524
251,746
65,357
11,775
5,676
4,619
1,173
120
7.2
3.5
2.8
0.7
0.1
130,276
183,757
320,086
1,530,773
6,859,873
Federal Tax Burden
Percent of Total
After‐Tax Income 5
Average Federal Tax Rate 6
Average (dollars)
Percent of Total
Average (dollars)
3.8
8.5
13.5
19.9
54.6
100.0
77
1,420
5,592
13,168
58,040
11,841
0.2
2.7
9.3
18.2
69.5
100.0
9,111
23,183
39,047
66,356
193,707
53,516
4.5
9.7
14.4
20.3
51.3
100.0
0.8
5.8
12.5
16.6
23.1
18.1
14.3
9.7
13.8
16.8
7.7
24,948
38,713
73,520
422,727
2,113,515
15.1
11.3
17.5
25.6
13.1
105,329
145,044
246,566
1,108,046
4,746,357
14.1
9.4
13.0
14.8
6.5
19.2
21.1
23.0
27.6
30.8
Percent of Total
Addendum
80‐90
90‐95
95‐99
Top 1 Percent
Top 0.1 Percent
Source: Urban‐Brookings Tax Policy Center Microsimulation Model (version 0411‐2).
Number of AMT Taxpayers (millions). Baseline: 4.3 Proposal: 4.3
* Less than 0.05
(1) Calendar year. Baseline is current law. Proposal is current law without the American Opportunity Tax Credit, Lifetime Learning Credit, tuition and fees deduction and the student loan interest deduction. (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 2011 dollars): 20% $16,812; 40% $33,542; 60% $59,486; 80% $103,465; 90% $163,173; 95% $210,998; 99% $532,613; 99.9% $2,178,886.
(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.