Research report

The federal individual income tax has had many more brackets and much higher rates in the past than it does today. In 1958, for example, there were 24 brackets (versus 6 today) and the top rate was 91 percent (versus 35 percent today). The impact of more brackets and higher rates on taxpayers...

October 12, 2011
Daniel BanemanJames R. Nunns
Research report

The earned income tax credit (EITC) is the most effective antipoverty program targeted to working-age households, delivering $60 annually. Critics note a relatively high error rate – with errors often stemming from complicated rules about who counts as a “qualifying child”. We analyze data from...

September 30, 2015
Elaine MaagMike PergamitDevlin HansonCaroline RatcliffeSara EdelsteinSarah Minton
Research report

Over the past seventy years Congress has enacted dozens of tax and transfer programs, giving little if any attention to the marriage subsidies and penalties that they inadvertently impose. Although the programs affect both rich and poor Americans, the penalties fall most heavily on low- or...

September 13, 2005
Adam CarassoC. Eugene Steuerle
Research report

The Urban-Brookings microsimulation tax model is a powerful tool for federal tax policy analysis. The model calculates tax liability for a representative sample of households, both under the rules that currently exist (current law) and under alternative scenarios. Based on these calculations,...

January 10, 2005
Jeffrey RohalyAdam CarassoMohammed Adeel Saleem
Research report

Corrective taxes can encourage healthier, safer, and less polluting behavior. But how should governments use their revenue? Options abound to cut other taxes, boost spending, or reduce borrowing. We organize those uses into four categories: offsetting new burdens, furthering the same goal,...

January 29, 2016
Adele C. MorrisDonald Marron
Research report

Small business is the source of our entrepreneurial genius, creativity, and productivity. Nonetheless, a substantial portion of our economic activity occurs within large corporations, non-profits and public enterprises. This paper discusses how the federal income tax treats firms of different...

January 30, 2008
Eric Toder
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. HarrisChristopher 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. HarrisRuth Levine