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Research report

Why Some Tax Units Pay No Income Tax

Rachel M. Johnson, James R. Nunns, Jeffrey Rohaly, Eric Toder, Roberton C. Williams
July 27, 2011
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Abstract

About 46 percent of American households will pay no federal individual income tax in 2011, roughly half of them because of structural features of the income tax that provide basic exemptions for subsistence level income and for dependents. The other half are nontaxable because tax expenditures special provisions in the tax code that benefit selected taxpayers or activitieswipe out tax liabilities and, in the case of refundable credits, yield net payments from the government. Provisions that benefit senior citizens and low-income working families with children particularly affect households with income under $50,000 but other factors make higher-income households nontaxable.

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Federal Budget and Economy
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Meet the Experts

  • Rachel M. Johnson
  • James R. Nunns
    Urban Institute Associate
  • Jeffrey Rohaly
    Principal Research Associate
  • Eric Toder
    Institute Fellow and Codirector, Tax Policy Center
  • Roberton C. Williams
    Urban Institute Associate
Research report

New Evidence on The Effect of The TCJA On the Housing Market

Robert McClelland, Livia Mucciolo, Safia Sayed
March 30, 2022
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