Introduction Introduction What is the Briefing Book? How is the Briefing Book Organized? How Should the Briefing Book be Used? Some Background Some Background The Numbers What are the federal government's sources of revenue? How does the federal government spend its money? What is the breakdown of tax revenues between federal, state, and local governments? How do U.S. taxes compare internationally? Budget Process How does it work? What is the history? What is the schedule? What is reconciliation? How is it enforced? What is PAYGO? Taxes and the Budget What is the short-term budget scenario? What is the long-term budget scenario? How accurate are short-run and long-run budget scenarios? How much spending is uncontrollable? What is generational accounting? What are extenders? What does it mean for a government program to be off-budget? Are Social Security trust funds real? Taxes and the Economy Economic Stimulus What is the Economic Stimulus Act of 2008? What does the 2008 stimulus act do for individuals? What does the 2008 stimulus act do for businesses? How does American Recovery and Reinvestment Act of 2009 change the tax code? What does the American Recovery and Reinvestment Act do for individuals? What does the American Recovery and Reinvestment Act do for businesses? What is the role of monetary policy? How do automatic stabilizers work? When is fiscal stimulus appropriate? What characteristics make fiscal stimulus most effective? What fiscal stimulus options would be most effective? What fiscal stimulus options would have questionable effectiveness? What fiscal stimulus options should be avoided? Distribution of Tax Burdens Are federal taxes progressive? How should progressivity be measured? Income Tax Issues How do the standard and itemized deductions compare? What's the difference between tax deductions and tax credits? How do phaseouts of tax benefits affect taxpayers? Tax Expenditures What are tax expenditures and how are they structured? What is a tax expenditure budget? Why are they controversial? How have they changed over time? What are the largest tax expenditures? Tax Gap What is the Tax Gap? What is being done now to close the gap? Can much of it be closed? Tax Shelters Bush Tax Cuts: Description How did they change the tax code? How did the 2001 tax cuts change the tax code? How did the 2002 tax cuts change the tax code? How did the 2003 tax cuts change the tax code? How did the 2004 tax cuts change the tax code? How did the 2005 tax cuts change the tax code? How did the 2006 tax cuts change the tax code? Bush Tax Cuts: Beneficiaries If we ignore how the cuts are paid for, who benefits from the Tax Cuts? If we account for how the cuts are paid for, who benefits from the tax cuts? Who benefits when their cost and potential economic growth are accounted for? How are the distributional effects measured? Bush Tax Cuts: Fiscal Effects How have they affected tax revenue? How big are the cuts? How do they compare with the Reagan cuts? Did they reduce the size of government? Are they justified as part of a "starve the beast" strategy? Are tax cuts an effective way to reduce government spending? How do the AMT and interest payments affect the cost? What is their impact on government borrowing and interest payments? What spending and revenue measures would pay for making them permanent? Bush Tax Cuts: Economic Effects How did they affect corporate investment? How did they affect small businesses and entrepreneurs? How did they affect incentives to work? How did they affect retirement saving? Were they well designed to strengthen long-term economic growth? Were they well timed to spur economic growth? What are the indirect effects on economic growth? Did they provide good "bang for the buck"? Didn't they help the economy recover from the 2001 recession? Key Elements of the US Tax System Key Elements of the US Tax System Taxation and the Family What is the personal exemption? Has the personal exemption kept up with prices and incomes? What is the Child Tax Credit (CTC)? What is the Earned Income Tax Credit (EITC)? How does the tax system subsidize child care expenses? What tax incentives exist to help families save for college? What tax incentives exist to help families pay for college? What are marriage penalties and bonuses? Taxes and the Poor How does the federal tax system affect low-income households? What is the difference between refundable and nonrefundable credits? Can poor families benefit from the child tax credit? Why do low-income families use paid tax preparers? Savings and Retirement What kinds of tax-favored accounts are there? How large are the tax expenditures for retirement saving? What are defined benefit retirement plans? Who uses tax-favored retirement savings accounts? What are defined contribution retirement plans? What types of non-employer-sponsored accounts are available? How does tax-favored retirement saving affect national saving? Where does the tax saving come from? What is an automatic 401(k)? How might saving be encouraged for low- and middle-income households? Individual AMT What is the AMT? Who pays the AMT? How much revenue does the AMT raise? What is the effect of the 2001-2006 Tax Cuts on the AMT? What is the effect of the AMT on the 2001-2006 tax cuts? What has been the effect of annual "patches?" Should it replace the regular income tax? Health Insurance/Health Care How much does the federal government spend on health care? Who has health insurance coverage? How does the tax exclusion for employer-sponsored health insurance work? How does the employer-sponsored insurance exclusion affect health insurance coverage? Homeownership What are the tax benefits? Do existing tax incentives increase homeownership? How could the tax incentives be improved? Education What tax incentives exist to help families save for college? What tax incentives exist to help families pay for college? Capital Gains and Dividends How are capital gains taxed? What is the effect of a lower tax rate? Wealth Transfer Taxes How do the estate, gift, and generation-skipping transfer taxes work? Who pays the estate tax? How many people pay the estate tax? What did Economic Growth and Tax Relief Reconciliation Act (EGTRRA) do to the estate, gift, and generation skipping transfer taxes? How could we reform the estate tax? What is an inheritance tax? Taxes and Energy What tax incentives encourage energy production? Taxes and the Environment What are green taxes? What green taxes does the United States impose? What green taxes do European countries impose? Business Taxation How does the corporate income tax work? What are flow-through enterprises and how are they taxed? What is carried interest and how should it be taxed? What are the options for reforming the taxation of carried interest? What are statutory and effective corporate tax rates? Tax Incentives for Economic Development What are tax incentives for economic development? What tax incentives promote the economic development of low-income communities? What is the Low-Income Housing Tax Credit? What tax incentives were created in response to 9/11? What tax incentives were created in response to Hurricanes Katrina, Rita and Wilma? Tax-exempt Organizations How are charitable contributions treated? Which entities are exempt? Who benefits from charitable deductions? How could incentives for charitable giving be improved? International Tax System How does the current system of international taxation work? What are the consequences of the U.S. International Tax System? How does the tax system impact U.S. competitiveness? How would formulary apportionment work? What are the options for reform? How Could We Improve the Federal Tax System? How Could We Improve the Federal Tax System? Incremental Reforms What are ten ways to simplify the tax system? How might saving be encouraged for low- and middle-income households? How could the tax incentives for homeownership be improved? How could we reform the estate tax? What are the options for reforming international taxation? Revenue-raising Options Tax Simplification Why are taxes so complicated? How costly is complexity? What are the benefits of simpler taxes? What policy reforms could simplify the tax code? National Retail Sales Tax: Description What is it? What would and would not be taxed? What would the tax rate be? Why wouldn't the rate be 23 percent? What is the difference between a tax-exclusive and a tax-inclusive sales tax rate? National Retail Sales Tax: Issues and Concerns Who bears the burden? How much avoidance and evasion would there be? What would be the effect on economic growth? What transition rules would be needed? Would it simplify the tax code? What did the President's Advisory Panel on Tax Reform say? What has been the state and local experience? What is the experience of other countries? Return-Free Filing What is it and how would it work? What are the benefits? What are the drawbacks? How would the tax system need to change? Who would qualify? Would it raise taxes? What was the experience in California? What other countries use it? The State of State (and Local) Tax Policy The State of State (and Local) Tax Policy State and Local Revenues What are the sources of revenue for state governments? What are the sources of revenue for local governments? How have the sources of revenue for state and local government changed over time? Specific State and Local Taxes How do state and local income taxes work? How do state and local sales taxes work? How do property taxes work? Fiscal Institutions and Intergovernmental Relations How does the deduction for state and local taxes work? What are rainy day funds and how do they work? What are tax and expenditure limits? Mortgage Crisis What is the mortgage crisis? How has the federal government responded? What is the Housing Assistance Tax Act of 2008? How have state legislatures responded? What financial assistance have states provided? What non-financial assistance have states provided? Glossary Appendix: TPC's Greatest Tables        Return to Glossary   Print This Page   Acronyms ACRS accelerated cost recovery system AFDC Aid to Families with Dependent Children AGI adjusted gross income AMT alternative minimum tax CBO Congressional Budget Office CDCTC child and dependent care tax credit CDE community development entity CRS Congressional Research Service CTC child tax credit CY calendar year DB defined benefit DC defined contribution DEFRA Deficit Reduction Act of 1984 DISC domestic international sales corporation EEC European Economic Community EITC earned income tax credit EGTRRA Economic Growth and Tax Relief Reconciliation Act of 2001 ERISA Employee Retirement Income Security Act of 1974 ERTA Economic Recovery Tax Act of 1981 ETI extraterritorial income exclusion ETR effective tax rate EU European Union FSC foreign sales corporation FY fiscal year GAO General Accountability Office GDP gross domestic product GNP gross national product HI Hospital Insurance (under Medicare) HSA health savings account IRA individual retirement account IRS Internal Revenue Service JCT Joint Committee on Taxation JGTRRA Jobs and Growth Tax Relief Reconciliation Act of 2003 MSA medical savings account NTJ National Tax Journal OASDI Old Age, Survivors, and Disability Insurance (Social Security) OASI Old Age and Survivors' Insurance OBRA Omnibus Budget Reconciliation Act (various years) OMB Office of Management and Budget OTA Office of Tax Analysis (Treasury) OTP Office of Tax Policy (Treasury) PAYGO pay-as-you-go PILOTS Payments in Lieu of Taxes PRWORA Personal Responsibility and Work Opportunity Reconciliation Act of 1986 REA retirement equity act SCHIP state children’s health insurance program SSI Supplemental Security Income TANF Temporary Assistance for Needy Families TEFRA Tax Equity and Fiscal Responsibility Act of 1982 TRA Tax Reform Act (various years) VAT value-added tax WTO World Trade Organization WtW Welfare-to-Work

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