28-Jan-15
VERY PRELIMINARY: SUBJECT TO REVISION
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 T15-0003
Major Individual Income Tax Provisions Outlined in President Obama's State of the Union Address
Baseline: Current Law
Distribution of Federal Tax Change by Expanded Cash Income Level, 2016 ¹
Summary Table
Expanded Cash Income
Level (thousands of 2013
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 with Tax Increase or Cut 3
With Tax Cut
Pct of Tax Units
36.3
31.7
20.3
18.3
18.8
23.6
32.6
52.5
31.5
5.3
2.2
30.4
Avg Tax Cut
-576
-668
-505
-454
-449
-545
-627
-635
-397
-1,293
-1,732
-580
With Tax Increase
Avg Tax
Pct of Tax Units
Increase
*
0.7
2.2
4.1
4.1
6.2
4.9
4.0
1.0
42.8
85.9
3.9
**
1,336
1,222
1,301
1,864
1,912
4,554
4,112
70,599
9,092
50,657
8,730
Percent Change
in After-Tax
Income 4
3.5
1.3
0.3
0.1
0.0
0.0
0.0
0.1
-0.2
-0.8
-2.0
-0.2
Share of Total
Federal Tax
Change
-8.2
-16.5
-5.6
-1.8
-0.4
-1.0
1.2
-18.5
20.4
16.7
109.1
100.0
Average
Federal Tax
Change ($)
-204
-203
-76
-30
-8
-11
20
-171
558
3,822
43,480
164
Average Federal Tax Rate5
Change (%
Points)
-3.3
-1.3
-0.3
-0.1
0.0
0.0
0.0
-0.1
0.2
0.5
1.3
0.2
Under the
Proposal
1.3
1.1
4.6
7.8
10.1
13.6
16.1
18.3
22.8
28.9
36.6
20.1
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0613-5).
Number of AMT Taxpayers (millions). Baseline: 4.8
Proposal: 4.8
* Less than 0.05
** Insufficient data
(1) Calendar year. Baseline is current law. Proposal would: (a) raise the top tax rate on long-term capital gains and qualified dividends from 20 percent to 24.2 percent; (b) tax
unrealized capital gains at death (table shows the fully-phased in impact of this provision); (c) enact a credit for second earners of up
to $500; (d) expand the earned income tax credit (EITC) for childless workers; (e) expand the child and dependent care tax credit (table does not include effects of repeal of
dependent care flexible spending accounts); (f) expand the American Opportunity Tax Credit (AOTC); (g) repeal the Lifetime Learning Tax Credit (table does not include the effect of
provisions related to student loan forgiveness or Section 529 education savings plans); (h) enact an “auto-IRA” proposal; (i) limit the size of accumulated balances in IRA and 401(k)-type
retirement accounts; and (j) repeal the deduction for student loan interest for new borrowers (table shows the fully phased in effect). Estimates in the table are based on descriptions
of these proposals provided by the Administration in its fact sheet:
http://www.whitehouse.gov/the-press-office/2015/01/17/fact-sheet-simpler-fairer-tax-code-responsibly-invests-middle-class-fami
For a description of TPC's current law baseline, see:
http://www.taxpolicycenter.org/taxtopics/Baseline-Definitions.cfm
(2) Includes both filing and non-filing units but excludes those that are dependents of other tax units. Tax units with negative adjusted gross income are excluded from their respective income class but are
included in the totals. For a description of expanded cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) Includes tax units with a change in federal tax burden of $10 or more in absolute value.
(4) After-tax income is expanded 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 expanded cash income.
28-Jan-15
VERY PRELIMINARY: SUBJECT TO REVISION
http://www.taxpolicycenter.org
Table T15-0003
Major Individual Income Tax Provisions Outlined in President Obama's State of the Union Address
Baseline: Current Law
Distribution of Federal Tax Change by Expanded Cash Income Level, 2016 ¹
Detail Table
Expanded Cash Income
Level (thousands of 2013
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
With Tax
Increase
36.3
31.7
20.3
18.3
18.8
23.6
32.6
52.5
31.5
5.3
2.2
30.4
*
0.7
2.2
4.1
4.1
6.2
4.9
4.0
1.0
42.8
85.9
3.9
Percent Change
in After-Tax
Income 4
Share of Total
Federal Tax
Change
3.5
1.3
0.3
0.1
0.0
0.0
0.0
0.1
-0.2
-0.8
-2.0
-0.2
-8.2
-16.5
-5.6
-1.8
-0.4
-1.0
1.2
-18.5
20.4
16.7
109.1
100.0
Average Federal Tax Change
Dollars
-204
-203
-76
-30
-8
-11
20
-171
558
3,822
43,480
164
Percent
-72.0
-53.4
-5.9
-1.0
-0.2
-0.1
0.1
-0.6
0.8
1.9
3.7
0.9
Share of Federal Taxes
Change (% Points)
-0.1
-0.1
-0.1
0.0
0.0
-0.1
-0.1
-0.4
0.0
0.1
0.7
0.0
Under the
Proposal
0.0
0.1
0.8
1.5
2.0
7.0
7.7
25.0
21.6
7.8
26.4
100.0
Average Federal Tax Rate5
Change (%
Points)
Under the
Proposal
-3.3
-1.3
-0.3
-0.1
0.0
0.0
0.0
-0.1
0.2
0.5
1.3
0.2
Baseline Distribution of Income and Federal Taxes
by Expanded Cash Income Level, 2016 ¹
Expanded Cash Income
Level (thousands of 2013
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
Pre-Tax Income
Number
(thousands)
Percent of
Total
Average (dollars)
10,764
21,954
19,661
16,011
12,822
24,605
16,308
29,194
9,885
1,183
678
164,808
6.5
13.3
11.9
9.7
7.8
14.9
9.9
17.7
6.0
0.7
0.4
100.0
6,190
16,095
26,361
37,032
47,606
65,365
91,774
146,327
299,793
713,230
3,336,255
94,528
Federal Tax Burden
Percent of
Total
0.4
2.3
3.3
3.8
3.9
10.3
9.6
27.4
19.0
5.4
14.5
100.0
After-Tax Income 4
Average (dollars)
Percent of
Total
Average (dollars)
Percent of
Total
284
379
1,298
2,931
4,821
8,881
14,716
26,977
67,818
202,519
1,176,375
18,855
0.1
0.3
0.8
1.5
2.0
7.0
7.7
25.3
21.6
7.7
25.7
100.0
5,906
15,715
25,062
34,101
42,785
56,485
77,058
119,350
231,975
510,711
2,159,880
75,672
0.5
2.8
4.0
4.4
4.4
11.1
10.1
27.9
18.4
4.8
11.7
100.0
Average
Federal Tax
Rate 5
4.6
2.4
4.9
7.9
10.1
13.6
16.0
18.4
22.6
28.4
35.3
20.0
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0613-5).
Number of AMT Taxpayers (millions). Baseline: 4.8
Proposal: 4.8
* Less than 0.05
(1) Calendar year. Baseline is current law. Proposal would: (a) raise the top tax rate on long-term capital gains and qualified dividends from 20 percent to 24.2 percent; (b) tax
unrealized capital gains at death (table shows the fully-phased in impact of this provision); (c) enact a credit for second earners of up
to $500; (d) expand the earned income tax credit (EITC) for childless workers; (e) expand the child and dependent care tax credit (table does not include effects of repeal of
dependent care flexible spending accounts); (f) expand the American Opportunity Tax Credit (AOTC); (g) repeal the Lifetime Learning Tax Credit (table does not include the effect of
provisions related to student loan forgiveness or Section 529 education savings plans); (h) enact an “auto-IRA” proposal; (i) limit the size of accumulated balances in IRA and 401(k)-type
retirement accounts; and (j) repeal the deduction for student loan interest for new borrowers (table shows the fully phased in effect). Estimates in the table are based on descriptions
of these proposals provided by the Administration in its fact sheet:
http://www.whitehouse.gov/the-press-office/2015/01/17/fact-sheet-simpler-fairer-tax-code-responsibly-invests-middle-class-fami
For a description of TPC's current law baseline, see:
http://www.taxpolicycenter.org/taxtopics/Baseline-Definitions.cfm
(2) Includes both filing and non-filing units but excludes those that are dependents of other tax units. Tax units with negative adjusted gross income are excluded from their respective income class but are
included in the totals. For a description of expanded cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) Includes tax units with a change in federal tax burden of $10 or more in absolute value.
(4) After-tax income is expanded 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 expanded cash income.
1.3
1.1
4.6
7.8
10.1
13.6
16.1
18.3
22.8
28.9
36.6
20.1
28-Jan-15
VERY PRELIMINARY: SUBJECT TO REVISION
http://www.taxpolicycenter.org
Table T15-0003
Major Individual Income Tax Provisions Outlined in President Obama's State of the Union Address
Baseline: Current Law
Distribution of Federal Tax Change by Expanded Cash Income Level, 2016 ¹
Detail Table - Single Tax Units
Expanded Cash Income
Level (thousands of 2013
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
With Tax Cut
3
With Tax
Increase
41.0
36.9
22.2
14.8
11.3
10.3
7.9
6.1
1.8
1.1
1.1
21.8
*
0.9
3.2
6.2
6.3
9.8
6.3
0.7
1.4
57.2
84.7
4.1
Percent Change
in After-Tax
4
Income
Share of Total
Federal Tax
Change
4.1
1.6
0.3
0.0
-0.2
-0.3
-0.7
-0.4
-0.7
-1.2
-2.7
-0.3
-27.8
-50.8
-11.5
1.5
6.6
22.5
35.8
24.2
19.9
10.5
61.6
100.0
Average Federal Tax Change
Dollars
-233
-236
-71
13
78
162
503
375
1,506
6,049
57,979
100
Percent
-56.0
-27.0
-3.1
0.3
1.2
1.4
2.7
1.2
2.0
2.8
4.5
1.1
Share of Federal Taxes
Change (%
Points)
-0.3
-0.6
-0.2
0.0
0.0
0.1
0.2
0.0
0.1
0.1
0.5
0.0
Under the
Proposal
0.2
1.4
3.8
5.3
5.9
17.2
14.2
21.6
10.9
4.1
14.9
100.0
5
Average Federal Tax Rate
Change (%
Points)
-3.8
-1.5
-0.3
0.0
0.2
0.3
0.6
0.3
0.5
0.9
1.7
0.2
Under the
Proposal
3.0
4.0
8.5
11.7
14.2
18.0
20.9
23.0
26.2
31.3
39.3
19.0
Baseline Distribution of Income and Federal Taxes
by Expanded Cash Income Level, 2016 ¹
Expanded Cash Income
Level (thousands of 2013
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
Tax Units
Pre-Tax Income
Number
(thousands)
Percent of
Total
Average (dollars)
8,866
16,020
12,106
8,702
6,249
10,357
5,309
4,814
985
130
79
74,432
11.9
21.5
16.3
11.7
8.4
13.9
7.1
6.5
1.3
0.2
0.1
100.0
6,177
16,023
26,183
36,976
47,482
65,401
90,951
138,693
299,252
708,853
3,405,735
50,088
Federal Tax Burden
Percent of
Total
1.5
6.9
8.5
8.6
8.0
18.2
13.0
17.9
7.9
2.5
7.2
100.0
After-Tax Income 4
Average (dollars)
Percent of
Total
Average (dollars)
Percent of
Total
417
876
2,300
4,329
6,649
11,632
18,525
31,465
76,909
215,847
1,280,491
9,438
0.5
2.0
4.0
5.4
5.9
17.2
14.0
21.6
10.8
4.0
14.4
100.0
5,761
15,147
23,883
32,648
40,833
53,769
72,426
107,228
222,343
493,005
2,125,243
40,650
1.7
8.0
9.6
9.4
8.4
18.4
12.7
17.1
7.2
2.1
5.6
100.0
Average
Federal Tax
5
Rate
6.7
5.5
8.8
11.7
14.0
17.8
20.4
22.7
25.7
30.5
37.6
18.8
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0613-5).
* Less than 0.05
(1) Calendar year. Baseline is current law. Proposal would: (a) raise the top tax rate on long-term capital gains and qualified dividends from 20 percent to 24.2 percent; (b) tax
unrealized capital gains at death (table shows the fully-phased in impact of this provision); (c) enact a credit for second earners of up
to $500; (d) expand the earned income tax credit (EITC) for childless workers; (e) expand the child and dependent care tax credit (table does not include effects of repeal of
dependent care flexible spending accounts); (f) expand the American Opportunity Tax Credit (AOTC); (g) repeal the Lifetime Learning Tax Credit (table does not include the effect of
provisions related to student loan forgiveness or Section 529 education savings plans); (h) enact an “auto-IRA” proposal; (i) limit the size of accumulated balances in IRA and 401(k)-type
retirement accounts; and (j) repeal the deduction for student loan interest for new borrowers (table shows the fully phased in effect). Estimates in the table are based on descriptions
of these proposals provided by the Administration in its fact sheet:
http://www.whitehouse.gov/the-press-office/2015/01/17/fact-sheet-simpler-fairer-tax-code-responsibly-invests-middle-class-fami
For a description of TPC's current law baseline, see:
http://www.taxpolicycenter.org/taxtopics/Baseline-Definitions.cfm
(2) Includes both filing and non-filing units but excludes those that are dependents of other tax units. Tax units with negative adjusted gross income are excluded from their respective income class but are
included in the totals. For a description of expanded cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) Includes tax units with a change in federal tax burden of $10 or more in absolute value.
(4) After-tax income is expanded 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 expanded cash income.
28-Jan-15
VERY PRELIMINARY: SUBJECT TO REVISION
http://www.taxpolicycenter.org
Table T15-0003
Major Individual Income Tax Provisions Outlined in President Obama's State of the Union Address
Baseline: Current Law
Distribution of Federal Tax Change by Expanded Cash Income Level, 2016 ¹
Detail Table - Married Tax Units Filing Jointly
Expanded Cash Income
Level (thousands of 2013
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
With Tax Cut
3
With Tax
Increase
14.8
17.2
18.2
20.8
26.1
35.9
50.7
65.5
35.6
5.9
2.3
44.3
*
0.1
0.3
1.7
2.2
3.5
4.9
5.0
0.8
40.5
86.4
4.7
Percent Change
in After-Tax
4
Income
Share of Total
Federal Tax
Change
0.8
0.6
0.3
0.2
0.2
0.2
0.3
0.2
-0.2
-0.7
-1.9
-0.3
-0.2
-0.9
-1.3
-1.2
-1.3
-4.8
-8.2
-31.2
18.3
17.2
111.0
100.0
Average Federal Tax Change
Dollars
-45
-105
-90
-77
-80
-112
-206
-291
443
3,534
40,652
332
Percent
-50.4
-464.2
-16.1
-5.6
-2.9
-1.8
-1.7
-1.1
0.7
1.8
3.6
1.0
Share of Federal Taxes
Change (%
Points)
0.0
0.0
0.0
0.0
0.0
-0.1
-0.1
-0.6
-0.1
0.1
0.8
0.0
Under the
Proposal
0.0
0.0
0.1
0.2
0.4
2.5
4.5
25.9
26.1
9.4
30.6
100.0
5
Average Federal Tax Rate
Change (%
Points)
-0.8
-0.6
-0.3
-0.2
-0.2
-0.2
-0.2
-0.2
0.2
0.5
1.2
0.2
Under the
Proposal
0.8
-0.5
1.8
3.5
5.5
9.3
13.0
17.2
22.3
28.6
36.2
21.5
Baseline Distribution of Income and Federal Taxes
by Expanded Cash Income Level, 2016 ¹
Expanded Cash Income
Level (thousands of 2013
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
Tax Units
Pre-Tax Income
Number
(thousands)
Percent of
Total
Average (dollars)
793
1,809
3,022
3,252
3,501
9,022
8,297
22,351
8,625
1,018
571
62,924
1.3
2.9
4.8
5.2
5.6
14.3
13.2
35.5
13.7
1.6
0.9
100.0
5,399
16,592
26,749
37,230
47,869
65,781
92,667
148,912
299,844
713,846
3,269,774
163,166
Federal Tax Burden
Percent of
Total
0.0
0.3
0.8
1.2
1.6
5.8
7.5
32.4
25.2
7.1
18.2
100.0
After-Tax Income 4
Average (dollars)
Percent of
Total
Average (dollars)
Percent of
Total
89
23
557
1,393
2,715
6,222
12,248
25,920
66,481
200,599
1,143,209
34,788
0.0
0.0
0.1
0.2
0.4
2.6
4.6
26.5
26.2
9.3
29.8
100.0
5,310
16,569
26,192
35,837
45,154
59,560
80,419
122,992
233,362
513,247
2,126,565
128,378
0.1
0.4
1.0
1.4
2.0
6.7
8.3
34.0
24.9
6.5
15.0
100.0
Average
Federal Tax
5
Rate
1.7
0.1
2.1
3.7
5.7
9.5
13.2
17.4
22.2
28.1
35.0
21.3
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0613-5).
* Less than 0.05
(1) Calendar year. Baseline is current law. Proposal would: (a) raise the top tax rate on long-term capital gains and qualified dividends from 20 percent to 24.2 percent; (b) tax
unrealized capital gains at death (table shows the fully-phased in impact of this provision); (c) enact a credit for second earners of up
to $500; (d) expand the earned income tax credit (EITC) for childless workers; (e) expand the child and dependent care tax credit (table does not include effects of repeal of
dependent care flexible spending accounts); (f) expand the American Opportunity Tax Credit (AOTC); (g) repeal the Lifetime Learning Tax Credit (table does not include the effect of
provisions related to student loan forgiveness or Section 529 education savings plans); (h) enact an “auto-IRA” proposal; (i) limit the size of accumulated balances in IRA and 401(k)-type
retirement accounts; and (j) repeal the deduction for student loan interest for new borrowers (table shows the fully phased in effect). Estimates in the table are based on descriptions
of these proposals provided by the Administration in its fact sheet:
http://www.whitehouse.gov/the-press-office/2015/01/17/fact-sheet-simpler-fairer-tax-code-responsibly-invests-middle-class-fami
For a description of TPC's current law baseline, see:
http://www.taxpolicycenter.org/taxtopics/Baseline-Definitions.cfm
(2) Includes both filing and non-filing units but excludes those that are dependents of other tax units. Tax units with negative adjusted gross income are excluded from their respective income class but are
included in the totals. For a description of expanded cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) Includes tax units with a change in federal tax burden of $10 or more in absolute value.
(4) After-tax income is expanded 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 expanded cash income.
28-Jan-15
VERY PRELIMINARY: SUBJECT TO REVISION
http://www.taxpolicycenter.org
Table T15-0003
Major Individual Income Tax Provisions Outlined in President Obama's State of the Union Address
Baseline: Current Law
Distribution of Federal Tax Change by Expanded Cash Income Level, 2016 ¹
Detail Table - Head of Household Tax Units
Expanded Cash Income
Level (thousands of 2013
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
With Tax Cut
3
With Tax
Increase
15.7
18.5
17.5
25.1
27.7
31.3
29.8
22.2
10.8
7.2
4.3
23.8
0.0
0.0
0.7
1.6
2.0
4.0
3.0
0.6
0.2
46.5
76.4
1.7
Percent Change
in After-Tax
4
Income
Share of Total
Federal Tax
Change
1.3
0.7
0.3
0.3
0.3
0.4
0.4
0.2
-0.1
-0.4
-1.5
0.3
3.1
15.1
11.9
12.1
10.9
30.9
20.7
11.3
-0.9
-1.3
-13.6
100.0
Average Federal Tax Change
Dollars
-98
-121
-89
-103
-125
-213
-293
-211
144
1,881
31,384
-129
Percent
12.4
7.7
7.1
-14.1
-4.2
-2.8
-2.1
-0.8
0.2
0.9
2.8
-2.2
Share of Federal Taxes
Change (%
Points)
-0.1
-0.4
-0.4
-0.2
-0.1
-0.2
0.0
0.4
0.3
0.1
0.5
0.0
Under the
Proposal
-0.6
-4.7
-4.0
1.7
5.6
24.1
21.9
31.3
10.3
3.2
11.0
100.0
5
Average Federal Tax Rate
Change (%
Points)
-1.4
-0.8
-0.3
-0.3
-0.3
-0.3
-0.3
-0.2
0.1
0.3
1.0
-0.2
Under the
Proposal
-12.7
-10.4
-5.0
1.7
6.0
11.5
15.2
19.3
24.1
29.2
35.4
10.8
Baseline Distribution of Income and Federal Taxes
by Expanded Cash Income Level, 2016 ¹
Expanded Cash Income
Level (thousands of 2013
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
Tax Units
Pre-Tax Income
Number
(thousands)
Percent of
Total
Average (dollars)
991
3,911
4,185
3,664
2,738
4,543
2,217
1,672
203
22
14
24,338
4.1
16.1
17.2
15.1
11.3
18.7
9.1
6.9
0.8
0.1
0.1
100.0
6,932
16,165
26,542
36,939
47,547
64,562
90,547
135,775
295,754
699,809
3,214,257
52,994
Federal Tax Burden
Percent of
Total
0.5
4.9
8.6
10.5
10.1
22.7
15.6
17.6
4.7
1.2
3.4
100.0
After-Tax Income 4
Average (dollars)
Percent of
Total
Average (dollars)
Percent of
Total
-785
-1,567
-1,243
731
2,981
7,621
14,072
26,369
71,059
202,428
1,107,169
5,864
-0.5
-4.3
-3.6
1.9
5.7
24.3
21.9
30.9
10.1
3.1
10.5
100.0
7,716
17,732
27,784
36,208
44,566
56,940
76,476
109,406
224,695
497,381
2,107,088
47,130
0.7
6.1
10.1
11.6
10.6
22.6
14.8
16.0
4.0
1.0
2.5
100.0
Average
Federal Tax
5
Rate
-11.3
-9.7
-4.7
2.0
6.3
11.8
15.5
19.4
24.0
28.9
34.5
11.1
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0613-5).
* Less than 0.05
(1) Calendar year. Baseline is current law. Proposal would: (a) raise the top tax rate on long-term capital gains and qualified dividends from 20 percent to 24.2 percent; (b) tax
unrealized capital gains at death (table shows the fully-phased in impact of this provision); (c) enact a credit for second earners of up
to $500; (d) expand the earned income tax credit (EITC) for childless workers; (e) expand the child and dependent care tax credit (table does not include effects of repeal of
dependent care flexible spending accounts); (f) expand the American Opportunity Tax Credit (AOTC); (g) repeal the Lifetime Learning Tax Credit (table does not include the effect of
provisions related to student loan forgiveness or Section 529 education savings plans); (h) enact an “auto-IRA” proposal; (i) limit the size of accumulated balances in IRA and 401(k)-type
retirement accounts; and (j) repeal the deduction for student loan interest for new borrowers (table shows the fully phased in effect). Estimates in the table are based on descriptions
of these proposals provided by the Administration in its fact sheet:
http://www.whitehouse.gov/the-press-office/2015/01/17/fact-sheet-simpler-fairer-tax-code-responsibly-invests-middle-class-fami
For a description of TPC's current law baseline, see:
http://www.taxpolicycenter.org/taxtopics/Baseline-Definitions.cfm
(2) Includes both filing and non-filing units but excludes those that are dependents of other tax units. Tax units with negative adjusted gross income are excluded from their respective income class but are
included in the totals. For a description of expanded cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) Includes tax units with a change in federal tax burden of $10 or more in absolute value.
(4) After-tax income is expanded 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 expanded cash income.
28-Jan-15
VERY PRELIMINARY: SUBJECT TO REVISION
http://www.taxpolicycenter.org
Table T15-0003
Major Individual Income Tax Provisions Outlined in President Obama's State of the Union Address
Baseline: Current Law
Distribution of Federal Tax Change by Expanded Cash Income Level, 2016 ¹
Detail Table - Tax Units with Children
Expanded Cash Income
Level (thousands of 2013
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
With Tax
Increase
5.6
9.3
12.3
23.5
27.3
39.9
53.0
69.5
40.2
8.3
3.5
39.5
0.0
*
0.6
1.8
2.5
4.2
5.1
4.5
0.4
37.6
82.5
3.6
Percent Change
in After-Tax
Income 4
Share of Total
Federal Tax
Change
0.6
0.4
0.2
0.3
0.3
0.4
0.5
0.4
0.0
-0.2
-1.2
0.1
1.3
7.1
8.0
11.6
10.9
40.2
49.5
151.2
10.9
-13.0
-175.4
100.0
Average Federal Tax Change
Dollars
-42
-67
-67
-107
-122
-228
-369
-487
-96
991
25,288
-82
Percent
4.1
3.1
3.6
205.7
-5.7
-3.5
-3.0
-1.9
-0.2
0.5
2.3
-0.4
Share of Federal Taxes
Change (% Points)
0.0
0.0
0.0
0.0
0.0
-0.1
-0.2
-0.4
0.1
0.1
0.7
0.0
Under the
Proposal
-0.1
-0.8
-0.8
-0.1
0.6
4.0
5.8
27.4
26.5
9.3
28.1
100.0
Average Federal Tax Rate5
Change (%
Points)
-0.6
-0.4
-0.3
-0.3
-0.3
-0.4
-0.4
-0.3
0.0
0.1
0.8
-0.1
Under the
Proposal
-16.4
-13.7
-7.2
-0.4
4.2
9.7
13.2
16.7
21.8
27.9
35.8
18.9
Baseline Distribution of Income and Federal Taxes
by Expanded Cash Income Level, 2016 ¹
Expanded Cash Income
Level (thousands of 2013
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
Pre-Tax Income
Number
(thousands)
Percent of
Total
Average (dollars)
1,314
4,482
5,071
4,588
3,767
7,470
5,676
13,148
4,834
554
294
51,650
2.5
8.7
9.8
8.9
7.3
14.5
11.0
25.5
9.4
1.1
0.6
100.0
6,606
16,300
26,480
36,926
47,623
65,340
92,064
148,626
299,909
711,773
3,175,190
122,065
Federal Tax Burden
Percent of
Total
0.1
1.2
2.1
2.7
2.9
7.7
8.3
31.0
23.0
6.3
14.8
100.0
After-Tax Income 4
Average (dollars)
Percent of
Total
Average (dollars)
Percent of
Total
-1,043
-2,157
-1,829
-52
2,130
6,550
12,489
25,232
65,360
197,781
1,111,551
23,105
-0.1
-0.8
-0.8
0.0
0.7
4.1
5.9
27.8
26.5
9.2
27.3
100.0
7,649
18,457
28,309
36,978
45,494
58,790
79,574
123,393
234,549
513,992
2,063,639
98,959
0.2
1.6
2.8
3.3
3.4
8.6
8.8
31.7
22.2
5.6
11.9
100.0
Average
Federal Tax
Rate 5
-15.8
-13.2
-6.9
-0.1
4.5
10.0
13.6
17.0
21.8
27.8
35.0
18.9
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0613-5).
* Less than 0.05
Note: Tax units with children are those claiming an exemption for children at home or away from home.
(1) Calendar year. Baseline is current law. Proposal would: (a) raise the top tax rate on long-term capital gains and qualified dividends from 20 percent to 24.2 percent; (b) tax
unrealized capital gains at death (table shows the fully-phased in impact of this provision); (c) enact a credit for second earners of up
to $500; (d) expand the earned income tax credit (EITC) for childless workers; (e) expand the child and dependent care tax credit (table does not include effects of repeal of
dependent care flexible spending accounts); (f) expand the American Opportunity Tax Credit (AOTC); (g) repeal the Lifetime Learning Tax Credit (table does not include the effect of
provisions related to student loan forgiveness or Section 529 education savings plans); (h) enact an “auto-IRA” proposal; (i) limit the size of accumulated balances in IRA and 401(k)-type
retirement accounts; and (j) repeal the deduction for student loan interest for new borrowers (table shows the fully phased in effect). Estimates in the table are based on descriptions
of these proposals provided by the Administration in its fact sheet:
http://www.whitehouse.gov/the-press-office/2015/01/17/fact-sheet-simpler-fairer-tax-code-responsibly-invests-middle-class-fami
For a description of TPC's current law baseline, see:
http://www.taxpolicycenter.org/taxtopics/Baseline-Definitions.cfm
(2) Includes both filing and non-filing units but excludes those that are dependents of other tax units. Tax units with negative adjusted gross income are excluded from their respective income class but are
included in the totals. For a description of expanded cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) Includes tax units with a change in federal tax burden of $10 or more in absolute value.
(4) After-tax income is expanded 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 expanded cash income.
28-Jan-15
VERY PRELIMINARY: SUBJECT TO REVISION
http://www.taxpolicycenter.org
Table T15-0003
Major Individual Income Tax Provisions Outlined in President Obama's State of the Union Address
Baseline: Current Law
Distribution of Federal Tax Change by Expanded Cash Income Level, 2016 ¹
Detail Table - Elderly Tax Units
Expanded Cash Income
Level (thousands of 2013
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
With Tax
Increase
5.1
4.8
7.6
8.5
7.7
8.6
12.0
18.3
7.7
0.5
0.2
9.1
*
*
0.2
0.8
1.1
1.0
1.7
2.9
2.6
51.5
92.0
1.7
Percent Change
in After-Tax
Income 4
Share of Total
Federal Tax
Change
0.2
0.1
0.0
-0.2
-0.4
-0.5
-1.0
-0.6
-1.5
-2.7
-4.1
-1.2
-0.1
-0.4
-0.1
0.9
2.0
6.0
9.9
10.8
17.2
9.7
41.6
100.0
Average Federal Tax Change
Dollars
-14
-20
-5
72
182
312
823
674
3,411
13,800
88,602
840
Percent
-20.9
-18.9
-0.9
4.5
6.4
5.3
7.1
2.9
5.0
6.6
7.5
5.7
Share of Federal Taxes
Change (% Points)
0.0
0.0
0.0
0.0
0.0
0.0
0.1
-0.6
-0.2
0.1
0.5
0.0
Under the
Proposal
0.0
0.1
0.5
1.1
1.8
6.5
8.1
20.8
19.8
8.5
32.5
100.0
Average Federal Tax Rate5
Change (%
Points)
Under the
Proposal
-0.2
-0.1
0.0
0.2
0.4
0.5
0.9
0.5
1.1
1.9
2.7
1.0
Baseline Distribution of Income and Federal Taxes
by Expanded Cash Income Level, 2016 ¹
Expanded Cash Income
Level (thousands of 2013
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
Pre-Tax Income
Number
(thousands)
Percent of
Total
Average (dollars)
1,457
6,526
5,200
4,042
3,424
6,060
3,810
5,100
1,597
222
149
37,787
3.9
17.3
13.8
10.7
9.1
16.0
10.1
13.5
4.2
0.6
0.4
100.0
6,339
16,345
26,113
37,177
47,594
64,902
91,972
141,706
302,486
716,118
3,337,465
83,961
Federal Tax Burden
Percent of
Total
0.3
3.4
4.3
4.7
5.1
12.4
11.1
22.8
15.2
5.0
15.7
100.0
After-Tax Income 4
Average (dollars)
Percent of
Total
Average (dollars)
Percent of
Total
65
104
590
1,581
2,826
5,953
11,639
23,129
68,857
209,788
1,185,167
14,622
0.0
0.1
0.6
1.2
1.8
6.5
8.0
21.4
19.9
8.4
31.9
100.0
6,274
16,242
25,523
35,596
44,767
58,949
80,334
118,577
233,628
506,330
2,152,298
69,339
0.4
4.1
5.1
5.5
5.9
13.6
11.7
23.1
14.2
4.3
12.2
100.0
Average
Federal Tax
Rate 5
1.0
0.6
2.3
4.3
5.9
9.2
12.7
16.3
22.8
29.3
35.5
17.4
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0613-5).
* Less than 0.05
Note: Elderly tax units are those with either head or spouse (if filing jointly) age 65 or older.
(1) Calendar year. Baseline is current law. Proposal would: (a) raise the top tax rate on long-term capital gains and qualified dividends from 20 percent to 24.2 percent; (b) tax
unrealized capital gains at death (table shows the fully-phased in impact of this provision); (c) enact a credit for second earners of up
to $500; (d) expand the earned income tax credit (EITC) for childless workers; (e) expand the child and dependent care tax credit (table does not include effects of repeal of
dependent care flexible spending accounts); (f) expand the American Opportunity Tax Credit (AOTC); (g) repeal the Lifetime Learning Tax Credit (table does not include the effect of
provisions related to student loan forgiveness or Section 529 education savings plans); (h) enact an “auto-IRA” proposal; (i) limit the size of accumulated balances in IRA and 401(k)-type
retirement accounts; and (j) repeal the deduction for student loan interest for new borrowers (table shows the fully phased in effect). Estimates in the table are based on descriptions
of these proposals provided by the Administration in its fact sheet:
http://www.whitehouse.gov/the-press-office/2015/01/17/fact-sheet-simpler-fairer-tax-code-responsibly-invests-middle-class-fami
For a description of TPC's current law baseline, see:
http://www.taxpolicycenter.org/taxtopics/Baseline-Definitions.cfm
(2) Includes both filing and non-filing units but excludes those that are dependents of other tax units. Tax units with negative adjusted gross income are excluded from their respective income class but are
included in the totals. For a description of expanded cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) Includes tax units with a change in federal tax burden of $10 or more in absolute value.
(4) After-tax income is expanded 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 expanded cash income.
0.8
0.5
2.2
4.4
6.3
9.7
13.6
16.8
23.9
31.2
38.2
18.4