Social Security was designed to redistribute income from those with higher lifetime earnings to those with lower lifetime earnings. The reason is obvious: the system was created to ensure an adequate retirement income for the elderly. Less obvious is how Social Security's many provisions...
The federal earned income tax credit (EITC) was established in 1975 as part of the individual income tax to offset payroll taxes for low-income working families. After several expansions, the refundable tax credit is now the largest federal cash assistance program for low-income families. A...
This testimony was presented before the the House Small Business Subcommittee on Workforce, Empowerment, and Government Programs. Linda Blumberg addresses Health Savings Accounts (HSAs) and HR 3901, a proposal to make private non-group premiums for the high-deductible health plans associated...
In his FY2005 budget, released Monday, President Bush proposes a set of new tax-preferred saving accounts (which were first presented in last year's budget). Under the Administration's proposal, two new types of individual accountscalled Lifetime Saving Accounts (LSAs) and Retirement Saving...
Despite the intensity of the debate over President Bush's tax policies, all political factions seem to agree that tax and spending programs should, on average, distribute economic resources from the rich to the poor. The arguments involve the amount of redistribution; only fringe groups ask...
Programs for working families and children are scheduled to shrink rapidly over the next few years, squeezed between rising expenditures on programs for the elderly and declines in tax revenues. This scenario will play out even if only modest defense and international needs are factored into the...
In 2001, Congress significantly expanded the scope of Individual Retirement Accounts (IRA). This paper uses variation in IRA eligibility rules in the 1980s and 1990s to determine whether more widespread access to IRAs undermines traditional employer-sponsored pensions, especially 401(k)-type...
In a tax system with increasing marginal tax rates, the tax increase from a boost to income is at least equal to the tax reduction from a decline in income and is larger if the change in income crosses a marginal tax bracket. As a result, people with volatile incomes may pay more tax than people...
Tax expenditures refer to the revenue losses attributable to provisions of the federal tax laws that deviate from a "normal" tax on income. Although there are debates over precisely what a tax expenditure is, many exclusions, deductions, credits, preferential rates, and deferrals of tax...
Health costs now total close to one-fifth of households' personal income. For moderate-income workers whose cash wages are lower then they would be if employers weren't paying for their health insurance, the bite is often bigger. Many elected officials seeking health care reform don't even know...
How Progressive Is Social Security and Why?
Social Security was designed to redistribute income from those with higher lifetime earnings to those with lower lifetime earnings. The reason is obvious: the system was created to ensure an adequate retirement income for the elderly. Less obvious is how Social Security's many provisions...
State Earned Income Tax Credits
The federal earned income tax credit (EITC) was established in 1975 as part of the individual income tax to offset payroll taxes for low-income working families. After several expansions, the refundable tax credit is now the largest federal cash assistance program for low-income families. A...
Health Savings Accounts and Tax Preferences for High Deductible Policies Purchased in the Non-Group Market
This testimony was presented before the the House Small Business Subcommittee on Workforce, Empowerment, and Government Programs. Linda Blumberg addresses Health Savings Accounts (HSAs) and HR 3901, a proposal to make private non-group premiums for the high-deductible health plans associated...
Key Thoughts on RSAs and LSAs
In his FY2005 budget, released Monday, President Bush proposes a set of new tax-preferred saving accounts (which were first presented in last year's budget). Under the Administration's proposal, two new types of individual accountscalled Lifetime Saving Accounts (LSAs) and Retirement Saving...
Searching for a Just Tax System
Despite the intensity of the debate over President Bush's tax policies, all political factions seem to agree that tax and spending programs should, on average, distribute economic resources from the rich to the poor. The arguments involve the amount of redistribution; only fringe groups ask...
The Incredible Shrinking Budget for Working Families and Children
Programs for working families and children are scheduled to shrink rapidly over the next few years, squeezed between rising expenditures on programs for the elderly and declines in tax revenues. This scenario will play out even if only modest defense and international needs are factored into the...
Pensions, Health Insurance, and Tax Incentives
In 2001, Congress significantly expanded the scope of Individual Retirement Accounts (IRA). This paper uses variation in IRA eligibility rules in the 1980s and 1990s to determine whether more widespread access to IRAs undermines traditional employer-sponsored pensions, especially 401(k)-type...
Taxes and Income Volatility
In a tax system with increasing marginal tax rates, the tax increase from a boost to income is at least equal to the tax reduction from a decline in income and is larger if the change in income crosses a marginal tax bracket. As a result, people with volatile incomes may pay more tax than people...
Tax Expenditures: Revenue Loss Versus Outlay Equivalents
Tax expenditures refer to the revenue losses attributable to provisions of the federal tax laws that deviate from a "normal" tax on income. Although there are debates over precisely what a tax expenditure is, many exclusions, deductions, credits, preferential rates, and deferrals of tax...
When Are Health Costs Excessive If $15,000 Is Average?
Health costs now total close to one-fifth of households' personal income. For moderate-income workers whose cash wages are lower then they would be if employers weren't paying for their health insurance, the bite is often bigger. Many elected officials seeking health care reform don't even know...