Research report

In 1979, federal taxes claimed 8 percent of the income of households in the lowest quintile of the income distribution.1 Over the following three decades, the average
effective tax rate (ETR) taxes as a percentage of income fell by nearly half to 4.3 percent in 2005. Most of the decline...

August 19, 2008
Roberton C. Williams
Research report

Fewer than one in seven individual income taxpayers reported taxable capital gains in 2006. Over half of taxpayers with gains had incomes below $75,000, but most capital gains were reported by very high income taxpayers. The 3 percent of returns with AGI over $200,000 reported 31 percent of AGI...

July 31, 2008
Eric Toder
Research report

Recent tax acts sharply lowered tax rates on long-term capital gains and dividend income. For millions of taxpayers, however, the alternative minimum tax limits the benefits from these cuts by increasing the effective marginal tax rates on capital gains and dividend income. The culprit is the...

March 3, 2008
Benjamin H. Harris, Christopher Geissler
Research report

From an economic perspective, marginal tax rates play a critical role in determining the consequences of a change in tax policy. In an uncomplicated tax system the marginal rate is simply equal to the statutory rate. For millions of taxpayers, however, marginal tax rates differ markedly from...

November 21, 2008
Benjamin H. Harris, Ruth Levine
Research report

A taxpayer's effective marginal tax rate (EMTR) is the percentage of an additional dollar of income that would be paid in federal income tax. An individual's EMTR could affect the decision to work or save more, or avoid income tax. We use the TPC's microsimulation model of the federal tax system...

September 30, 2008
Katherine Lim, Jeffrey Rohaly
Research report

Republican Presidential Candidate Fred Thompson has announced a tax plan that combines tax cut extensions, additional tax cuts, and an election to pay tax under a new alternative tax system that would substitute a larger standard deduction for all current deductions and credits and have two...

December 10, 2007
Leonard E. Burman, Greg Leiserson, Jeffrey Rohaly
Research report

Student loans, mortgage guarantees, and other lending programs create special challenges for federal budgeting. Under official budget rules, these programs are projected to bring in $200 billion over the next decade. Under an alternative, favored by many analysts, they appear to lose $100...

September 29, 2014
Donald Marron
Research report

Recently, there has been a spate of corporate inversions, where U.S. multinational corporations have combined with foreign companies, arranging their corporate structure to locate the residence of the resulting corporation in a foreign country with an attractive corporate tax climate. This paper...

August 20, 2014
Kimberly A. Clausing
Research report

Under current law, taxpayers may deduct interest paid on up to $1 million of acquisition debt used to buy, build, or improve a primary or secondary residence. Taxpayers can also deduct interest paid on up to $100,000 in home equity loans or other loans secured by their homes. This report...

May 14, 2014
Amanda Eng
Research report

A corporate income tax can play a useful role by preventing shareholders from deferring tax on retained corporate profits. The current U.S. corporate income tax is deeply flawed, however, because it relies on definitions of corporate residence and income sourcing that corporations can easily...

April 3, 2014
Eric Toder, Alan Viard