4-Feb-10
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 T10-0052
Administration's FY2011 Budget Proposals
Extend the Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit,
Raise Child and Dependent Care Tax Credit Phaseout Threshold,
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Current Policy
Distribution of Federal Tax Change by Cash Income Level, 2012 1
Summary Table
Cash Income Level
(thousands of 2009
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 Units 3
With Tax Cut
24.7
33.5
38.4
44.8
42.7
40.2
37.7
26.4
13.9
12.3
10.8
34.5
With Tax
Increase
0.0
0.8
1.0
1.3
0.6
0.2
0.1
0.0
0.0
0.1
0.0
0.5
Percent
Change in
After-Tax
4
Income
2.5
1.8
1.1
0.8
0.6
0.5
0.3
0.2
0.1
0.0
0.0
0.4
Share of Total
Federal Tax
Change
6.2
17.5
15.2
11.6
8.7
15.1
8.6
13.9
2.3
0.4
0.3
100.0
Average
Federal Tax
Change ($)
-135
-266
-265
-266
-250
-245
-221
-249
-140
-155
-217
-235
5
Average Federal Tax Rate
Change (%
Points)
-2.4
-1.7
-1.0
-0.7
-0.5
-0.4
-0.2
-0.2
-0.1
0.0
0.0
-0.3
Under the
Proposal
3.0
2.8
7.7
12.0
14.8
17.1
18.9
21.5
24.4
25.5
29.6
20.4
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-4)
Number of AMT Taxpayers (millions). Baseline:
5.0
Proposal: 4.9
(1) Calendar year. Current policy 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. The proposal would: (a) extend the higher EITC
credit value for famillies with 3 children and higher phase-out thresholds for married couples; (b) modify the saver's credit making it equal to 50% of the first $500 of
retirement savings ($1,000 for copules) and fully refundable; (c) create automatic 401(k)s and IRAs; (d) extend the American Opportunity Tax Credit; (e) extend the
$3,000 child tax credit refundability threshold; (f) raise the child and dependent care tax credit phase-out threshold to $85,000.
(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.
4-Feb-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0052
Administration's FY2011 Budget Proposals
Extend the Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit,
Raise Child and Dependent Care Tax Credit Phaseout Threshold,
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Current Policy
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
24.7
33.5
38.4
44.8
42.7
40.2
37.7
26.4
13.9
12.3
10.8
34.5
0.0
0.8
1.0
1.3
0.6
0.2
0.1
0.0
0.0
0.1
0.0
0.5
Percent Change
in After-Tax
Income 4
2.5
1.8
1.1
0.8
0.6
0.5
0.3
0.2
0.1
0.0
0.0
0.4
Share of Total
Federal Tax
Change
6.2
17.5
15.2
11.6
8.7
15.1
8.6
13.9
2.3
0.4
0.3
100.0
Average Federal Tax Change
Dollars
-135
-266
-265
-266
-250
-245
-221
-249
-140
-155
-217
-235
Percent
-44.3
-38.0
-11.8
-5.8
-3.5
-2.2
-1.3
-0.8
-0.2
-0.1
0.0
-1.5
Share of Federal Taxes
Change (%
Points)
-0.1
-0.3
-0.2
-0.1
-0.1
-0.1
0.0
0.2
0.2
0.1
0.3
0.0
Under the
Proposal
0.1
0.4
1.7
2.9
3.6
10.2
10.1
25.6
17.5
7.7
20.0
100.0
Average Federal Tax Rate 5
Change (%
Points)
-2.4
-1.7
-1.0
-0.7
-0.5
-0.4
-0.2
-0.2
-0.1
0.0
0.0
-0.3
Under the
Proposal
3.0
2.8
7.7
12.0
14.8
17.1
18.9
21.5
24.4
25.5
29.6
20.4
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)
16,958
24,305
21,133
16,074
12,909
22,702
14,431
20,606
5,930
1,048
531
157,348
Percent of
Total
10.8
15.5
13.4
10.2
8.2
14.4
9.2
13.1
3.8
0.7
0.3
100.0
Average
Income
(Dollars)
5,723
15,533
25,808
36,190
46,615
64,099
90,195
141,257
296,062
704,969
3,114,004
76,169
Average
Federal Tax
Burden
(Dollars)
304
700
2,243
4,617
7,139
11,192
17,259
30,550
72,234
179,772
921,818
15,750
Average AfterTax Income 4
(Dollars)
5,419
14,833
23,564
31,572
39,476
52,908
72,936
110,706
223,828
525,197
2,192,186
60,419
Average
Federal Tax
Rate 5
5.3
4.5
8.7
12.8
15.3
17.5
19.1
21.6
24.4
25.5
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
3.2
4.6
4.9
5.0
12.1
10.9
24.3
14.7
6.2
13.8
100.0
1.0
3.8
5.2
5.3
5.4
12.6
11.1
24.0
14.0
5.8
12.2
100.0
0.2
0.7
1.9
3.0
3.7
10.3
10.1
25.4
17.3
7.6
19.8
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-4)
Number of AMT Taxpayers (millions). Baseline: 5.0
Proposal: 4.9
(1) Calendar year. Current policy 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. The proposal would: (a) extend the higher EITC credit value for famillies with 3 children and higher phase-out thresholds for married couples; (b) modify the saver's credit
making it equal to 50% of the first $500 of retirement savings ($1,000 for copules) and fully refundable; (c) create automatic 401(k)s and IRAs; (d) extend the American Opportunity Tax Credit; (e) extend the $3,000 child tax
credit refundability threshold; (f) raise the child and dependent care tax credit phase-out threshold to $85,000.
(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.
4-Feb-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0052
Administration's FY2011 Budget Proposals
Extend the Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit,
Raise Child and Dependent Care Tax Credit Phaseout Threshold,
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Current Policy
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
17.9
19.7
27.9
36.6
27.7
15.9
13.4
7.9
3.9
6.2
3.7
21.6
0.0
1.2
0.7
0.2
0.0
0.0
0.0
0.0
0.0
0.1
0.0
0.4
Percent Change
in After-Tax
Income 4
1.7
0.8
0.6
0.6
0.3
0.2
0.2
0.1
0.0
0.0
0.0
0.3
Share of Total
Federal Tax
Change
13.6
20.7
18.9
16.1
8.7
12.5
5.3
3.3
0.6
0.1
0.1
100.0
Average Federal Tax Change
Dollars
-89
-110
-134
-169
-114
-113
-116
-77
-64
-52
-64
-115
Percent
-18.4
-8.6
-4.0
-2.7
-1.3
-0.8
-0.6
-0.2
-0.1
0.0
0.0
-1.3
Share of Federal Taxes
Change (%
Points)
-0.2
-0.2
-0.2
-0.1
0.0
0.1
0.1
0.2
0.1
0.1
0.2
0.0
Under the
Proposal
0.8
2.8
5.9
7.4
8.5
19.0
12.1
18.1
9.6
4.3
11.6
100.0
Average Federal Tax Rate5
Change (%
Points)
-1.6
-0.7
-0.5
-0.5
-0.3
-0.2
-0.1
-0.1
0.0
0.0
0.0
-0.3
Under the
Proposal
6.9
7.6
12.6
16.8
18.9
21.3
23.4
24.2
25.2
27.5
32.4
20.5
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
12,161
14,889
11,204
7,555
6,018
8,766
3,599
3,384
787
138
75
68,932
17.6
21.6
16.3
11.0
8.7
12.7
5.2
4.9
1.1
0.2
0.1
100.0
Average
Income
(Dollars)
5,710
15,384
25,667
36,120
46,555
63,234
89,193
137,406
300,163
697,814
2,972,435
43,878
Average
Federal Tax
Burden
(Dollars)
482
1,279
3,376
6,232
8,898
13,559
21,025
33,285
75,636
192,065
962,594
9,128
Average AfterTax Income 4
(Dollars)
5,228
14,105
22,291
29,888
37,657
49,675
68,169
104,121
224,527
505,749
2,009,841
34,749
Average
Federal Tax
Rate 5
8.5
8.3
13.2
17.3
19.1
21.4
23.6
24.2
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
7.6
9.5
9.0
9.3
18.3
10.6
15.4
7.8
3.2
7.3
100.0
2.7
8.8
10.4
9.4
9.5
18.2
10.2
14.7
7.4
2.9
6.3
100.0
0.9
3.0
6.0
7.5
8.5
18.9
12.0
17.9
9.5
4.2
11.4
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-4)
(1) Calendar year. Current policy 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. The proposal would: (a) extend the higher EITC credit value for famillies with 3 children and higher phase-out thresholds for married couples; (b) modify the saver's credit
making it equal to 50% of the first $500 of retirement savings ($1,000 for copules) and fully refundable; (c) create automatic 401(k)s and IRAs; (d) extend the American Opportunity Tax Credit; (e) extend the $3,000 child tax
credit refundability threshold; (f) raise the child and dependent care tax credit phase-out threshold to $85,000.
(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.
4-Feb-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0052
Administration's FY2011 Budget Proposals
Extend the Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit,
Raise Child and Dependent Care Tax Credit Phaseout Threshold,
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Current Policy
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
20.9
39.9
45.4
48.6
55.1
58.4
48.6
30.8
15.8
13.3
12.2
40.6
0.1
0.0
0.4
3.0
1.7
0.5
0.1
0.0
0.1
0.0
0.0
0.5
Percent Change
in After-Tax
Income 4
2.5
2.0
1.5
1.1
1.0
0.6
0.3
0.3
0.1
0.0
0.0
0.3
Share of Total
Federal Tax
Change
1.4
7.3
10.2
9.2
9.3
18.2
12.5
26.1
4.2
0.8
0.6
100.0
Average Federal Tax Change
Dollars
-113
-319
-381
-376
-407
-331
-246
-290
-152
-173
-250
-294
Percent
-49.9
-72.5
-32.7
-14.0
-8.5
-3.6
-1.6
-1.0
-0.2
-0.1
0.0
-1.1
Share of Federal Taxes
Change (%
Points)
0.0
-0.1
-0.1
-0.1
-0.1
-0.1
0.0
0.0
0.2
0.1
0.3
0.0
Under the
Proposal
0.0
0.0
0.2
0.6
1.1
5.3
8.6
29.3
21.5
9.5
23.7
100.0
Average Federal Tax Rate5
Change (%
Points)
-2.4
-2.0
-1.5
-1.0
-0.9
-0.5
-0.3
-0.2
-0.1
0.0
0.0
-0.2
Under the
Proposal
2.4
0.8
3.0
6.4
9.4
13.5
16.9
20.8
24.2
25.2
29.1
21.2
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
2,172
4,097
4,842
4,391
4,095
9,883
9,149
16,193
4,941
876
435
61,357
3.5
6.7
7.9
7.2
6.7
16.1
14.9
26.4
8.1
1.4
0.7
100.0
Average
Income
(Dollars)
4,766
16,031
25,959
36,302
46,760
65,241
90,792
142,545
295,420
706,519
3,075,014
126,020
Average
Federal Tax
Burden
(Dollars)
227
440
1,166
2,695
4,792
9,109
15,571
29,953
71,673
178,012
895,007
27,037
Average AfterTax Income 4
(Dollars)
4,539
15,591
24,794
33,607
41,968
56,132
75,221
112,592
223,748
528,507
2,180,007
98,983
Average
Federal Tax
Rate 5
4.8
2.7
4.5
7.4
10.3
14.0
17.2
21.0
24.3
25.2
29.1
21.5
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
0.1
0.9
1.6
2.1
2.5
8.3
10.7
29.9
18.9
8.0
17.3
100.0
0.2
1.1
2.0
2.4
2.8
9.1
11.3
30.0
18.2
7.6
15.6
100.0
0.0
0.1
0.3
0.7
1.2
5.4
8.6
29.2
21.4
9.4
23.5
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-4)
(1) Calendar year. Current policy 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. The proposal would: (a) extend the higher EITC credit value for famillies with 3 children and higher phase-out thresholds for married couples; (b) modify the saver's credit
making it equal to 50% of the first $500 of retirement savings ($1,000 for copules) and fully refundable; (c) create automatic 401(k)s and IRAs; (d) extend the American Opportunity Tax Credit; (e) extend the $3,000 child tax
credit refundability threshold; (f) raise the child and dependent care tax credit phase-out threshold to $85,000.
(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.
4-Feb-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0052
Administration's FY2011 Budget Proposals
Extend the Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit,
Raise Child and Dependent Care Tax Credit Phaseout Threshold,
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Current Policy
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
61.8
69.8
56.2
58.3
60.8
53.0
35.8
19.6
8.8
14.4
5.0
57.0
0.2
0.2
2.2
1.8
0.4
0.1
0.0
0.0
0.0
0.2
0.0
0.8
Percent Change
in After-Tax
Income 4
5.4
4.2
1.8
1.1
0.9
0.7
0.5
0.2
0.1
0.0
0.0
1.2
Share of Total
Federal Tax
Change
8.9
32.3
20.6
12.2
7.9
11.8
4.7
1.4
0.3
0.0
0.0
100.0
Average Federal Tax Change
Dollars
-385
-694
-467
-349
-346
-358
-363
-166
-200
-124
-89
-440
Percent
74.1
77.9
-89.4
-10.2
-5.4
-3.3
-2.0
-0.6
-0.3
-0.1
0.0
-7.7
Share of Federal Taxes
Change (%
Points)
-0.8
-3.0
-1.6
-0.3
0.3
1.3
1.1
1.5
0.6
0.2
0.6
0.0
Under the
Proposal
-1.7
-6.2
0.2
8.9
11.6
28.9
19.0
20.6
8.1
3.1
7.5
100.0
Average Federal Tax Rate5
Change (%
Points)
-5.8
-4.5
-1.8
-1.0
-0.7
-0.6
-0.4
-0.1
-0.1
0.0
0.0
-1.1
Under the
Proposal
-13.6
-10.2
0.2
8.5
13.1
16.6
19.7
22.7
23.8
24.1
30.0
12.6
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
2,483
5,029
4,757
3,767
2,449
3,559
1,389
877
150
24
11
24,547
10.1
20.5
19.4
15.4
10.0
14.5
5.7
3.6
0.6
0.1
0.0
100.0
Average
Income
(Dollars)
6,647
15,579
25,971
36,157
46,569
63,082
89,214
132,993
294,130
686,382
2,985,055
41,760
Average
Federal Tax
Burden
(Dollars)
-520
-891
522
3,410
6,468
10,832
17,970
30,391
70,182
165,311
896,479
5,698
Average AfterTax Income 4
(Dollars)
7,167
16,470
25,449
32,747
40,102
52,250
71,244
102,602
223,948
521,071
2,088,576
36,062
Average
Federal Tax
Rate 5
-7.8
-5.7
2.0
9.4
13.9
17.2
20.1
22.9
23.9
24.1
30.0
13.6
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
12.1
13.3
11.1
21.9
12.1
11.4
4.3
1.6
3.2
100.0
2.0
9.4
13.7
13.9
11.1
21.0
11.2
10.2
3.8
1.4
2.6
100.0
-0.9
-3.2
1.8
9.2
11.3
27.6
17.9
19.1
7.5
2.8
6.9
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-4)
(1) Calendar year. Current policy 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. The proposal would: (a) extend the higher EITC credit value for famillies with 3 children and higher phase-out thresholds for married couples; (b) modify the saver's credit
making it equal to 50% of the first $500 of retirement savings ($1,000 for copules) and fully refundable; (c) create automatic 401(k)s and IRAs; (d) extend the American Opportunity Tax Credit; (e) extend the $3,000 child tax
credit refundability threshold; (f) raise the child and dependent care tax credit phase-out threshold to $85,000.
(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.
4-Feb-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0052
Administration's FY2011 Budget Proposals
Extend the Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit,
Raise Child and Dependent Care Tax Credit Phaseout Threshold,
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Current Policy
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
63.8
80.0
70.2
72.5
73.4
67.3
57.9
40.5
18.2
15.0
12.5
60.2
0.2
0.2
1.4
1.3
0.4
0.1
0.1
0.0
0.0
0.0
0.1
0.4
Percent Change
in After-Tax
Income 4
5.8
4.8
2.5
1.6
1.4
0.8
0.5
0.4
0.1
0.0
0.0
0.7
Share of Total
Federal Tax
Change
4.8
18.8
15.1
10.7
8.6
13.6
8.8
16.4
2.4
0.4
0.2
100.0
Average Federal Tax Change
Dollars
-404
-833
-663
-547
-557
-457
-374
-439
-213
-219
-296
-508
Percent
55.7
56.1
311.3
-20.3
-9.7
-4.6
-2.3
-1.5
-0.3
-0.1
0.0
-2.6
Share of Federal Taxes
Change (%
Points)
-0.1
-0.5
-0.4
-0.3
-0.2
-0.2
0.0
0.4
0.5
0.2
0.5
0.0
Under the
Proposal
-0.4
-1.4
-0.5
1.1
2.2
7.7
10.1
29.7
21.6
9.0
20.9
100.0
Average Federal Tax Rate 5
Change (%
Points)
-6.5
-5.3
-2.6
-1.5
-1.2
-0.7
-0.4
-0.3
-0.1
0.0
0.0
-0.5
Under the
Proposal
-18.1
-14.7
-3.4
6.0
11.1
14.8
17.6
20.8
24.8
26.7
30.3
19.8
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
2,968
5,639
5,683
4,891
3,849
7,425
5,841
9,319
2,750
441
206
49,155
6.0
11.5
11.6
10.0
7.8
15.1
11.9
19.0
5.6
0.9
0.4
100.0
Average
Income
(Dollars)
6,252
15,769
25,918
36,161
46,701
64,368
90,740
142,137
293,742
705,334
3,105,769
95,419
Average
Federal Tax
Burden
(Dollars)
-725
-1,486
-213
2,697
5,732
10,005
16,320
30,006
73,044
188,573
941,142
19,366
Average AfterTax Income 4
(Dollars)
6,977
17,255
26,131
33,464
40,969
54,363
74,420
112,132
220,698
516,761
2,164,627
76,053
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
-9.4
-0.8
7.5
12.3
15.5
18.0
21.1
24.9
26.7
30.3
20.3
0.4
1.9
3.1
3.8
3.8
10.2
11.3
28.2
17.2
6.6
13.7
100.0
0.6
2.6
4.0
4.4
4.2
10.8
11.6
28.0
16.2
6.1
11.9
100.0
-0.2
-0.9
-0.1
1.4
2.3
7.8
10.0
29.4
21.1
8.7
20.4
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-4)
Note: Tax units with children are those claiming an exemption for children at home or away from home.
(1) Calendar year. Current policy 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. The proposal would: (a) extend the higher EITC credit value for famillies with 3 children and higher phase-out thresholds for married couples; (b) modify the saver's credit
making it equal to 50% of the first $500 of retirement savings ($1,000 for copules) and fully refundable; (c) create automatic 401(k)s and IRAs; (d) extend the American Opportunity Tax Credit; (e) extend the $3,000 child tax
credit refundability threshold; (f) raise the child and dependent care tax credit phase-out threshold to $85,000.
(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.
4-Feb-10
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T10-0052
Administration's FY2011 Budget Proposals
Extend the Earned Income Tax Credit Expansion, Expand Refundability of Child Tax Credit,
Raise Child and Dependent Care Tax Credit Phaseout Threshold,
Create Automatic IRAs and 401(k)s, Expand the Saver's Credit, Provide American Opportunity Tax Credit
Baseline: Current Policy
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
4.3
4.0
7.2
8.7
10.1
15.2
14.3
9.4
8.7
8.6
10.0
8.7
0.0
0.1
0.0
0.4
0.1
0.3
0.1
0.0
0.0
0.0
0.0
0.1
Percent Change
in After-Tax
Income 4
0.2
0.1
0.1
0.1
0.1
0.1
0.1
0.0
0.0
0.0
0.0
0.1
Share of Total
Federal Tax
Change
3.2
8.2
11.6
6.9
7.7
24.9
12.5
15.1
5.2
2.0
2.6
100.0
Average Federal Tax Change
Dollars
-14
-13
-23
-23
-34
-57
-50
-51
-46
-81
-194
-33
Percent
-7.0
-3.3
-2.1
-1.1
-1.1
-0.9
-0.4
-0.2
-0.1
-0.1
0.0
-0.3
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
0.1
0.0
Under the
Proposal
0.1
0.6
1.4
1.6
1.7
7.1
7.4
18.9
19.3
10.8
31.0
100.0
Average Federal Tax Rate 5
Change (%
Points)
-0.2
-0.1
-0.1
-0.1
-0.1
-0.1
-0.1
0.0
0.0
0.0
0.0
0.0
Under the
Proposal
2.9
2.4
4.3
5.8
6.6
9.9
13.1
17.7
22.2
24.5
30.1
17.1
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
2,305
6,471
5,084
2,999
2,259
4,405
2,504
2,986
1,128
245
132
30,543
7.6
21.2
16.7
9.8
7.4
14.4
8.2
9.8
3.7
0.8
0.4
100.0
Average
Income
(Dollars)
6,366
15,655
25,560
36,054
46,537
64,489
89,136
141,589
304,121
709,954
3,095,895
75,737
Average
Federal Tax
Burden
(Dollars)
196
389
1,110
2,113
3,082
6,454
11,740
25,072
67,695
173,685
930,715
12,990
Average AfterTax Income 4
(Dollars)
6,170
15,266
24,450
33,941
43,455
58,035
77,395
116,518
236,427
536,269
2,165,180
62,747
Average
Federal Tax
Rate 5
3.1
2.5
4.3
5.9
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
4.4
5.6
4.7
4.5
12.3
9.7
18.3
14.8
7.5
17.7
100.0
0.7
5.2
6.5
5.3
5.1
13.3
10.1
18.2
13.9
6.9
14.9
100.0
0.1
0.6
1.4
1.6
1.8
7.2
7.4
18.9
19.2
10.8
31.0
100.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0509-4)
Note: Elderly tax units are those with either head or spouse (if filing jointly) age 65 or older.
(1) Calendar year. Current policy 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. The proposal would: (a) extend the higher EITC credit value for famillies with 3 children and higher phase-out thresholds for married couples; (b) modify the saver's credit
making it equal to 50% of the first $500 of retirement savings ($1,000 for copules) and fully refundable; (c) create automatic 401(k)s and IRAs; (d) extend the American Opportunity Tax Credit; (e) extend the $3,000 child tax
credit refundability threshold; (f) raise the child and dependent care tax credit phase-out threshold to $85,000.
(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.