Clear nonpartisan analysis of fiscal and tax policy enables policymakers and the public to weigh competing theories on how to end the country’s economic crisis. Urban Institute researchers evaluated key components of the stimulus package and analyzed the tax proposals in the president’s budget. Warning decisionmakers about the unsustainable fiscal course ahead, our experts propose ways to control deficits and reform the entitlement programs that drive up spending. Read more.
Roughly 77 million Americans, or 35 percent of adults with a credit file, have a report of debt in collections. These adults owe an average of $5,178 (median $1,349). Debt in collections involves a nonmortgage bill—such as a credit card balance, medical or utility bill—that is more than 180 days past due and has been placed in collections. 5.3 percent of people with a credit file have a report of past due debt, indicating they are between 30 and 180 days late on a nonmortgage payment. Both debt in collections and debt past due are concentrated in the South.
Thirty-five percent of adults have a debt in collections reported in their credit files, an Urban Institute study shows. Nevada, hit hard by the housing crisis, tops the list of states: 47 percent of people with a credit file have reported debt in collections. The state also has the highest average collections debt. Twelve other states (11 in the South) and the District of Columbia top 40 percent.
In a contribution to The Wall Street Journal's MarketWatch, Eric Toder explains why corporations expatriate from the United States and argues that they will continue to do so until Congress addresses the fundamental flaws in the corporate income tax. He then provides some possible solutions to end the erosion of the U.S. corporate tax base.
This Tax Fact explores the child tax credit’s refundability thresholds since its inception. Currently, the CTC is a $1,000-per-child credit that is partially refundable for households earning more than $3,000. This Tax Fact explores the distribution of credits when the refundability threshold rises to $15,000 in 2018, and finds that families in the lowest income quintile would be affected the most.
In this testimony before the Senate Permanent Subcommittee on Investigations, Steve Rosenthal describes how two hedge funds, with the help of two investment banks, purported to convert short-term trading profits into long-term capital gains with derivatives—which lowered the tax rate on their gains from 35% to 15% (the difference in rates for short-term and long-term gains for most of the years in question). He explains why he believes the funds stretched the tax law to achieve their goal. He also recommends legislation to address the misuse of derivatives more comprehensively.
What role can policymakers play in helping families rebuild their balance sheets after the Great Recession and in helping young families, families of color, and those with less education who were falling behind even prior to it? This brief, based on a convening of nearly 25 national wealth-building experts, presents the facts and identifies four promising policy reforms: (1) providing universal children’s savings accounts; (2) reforming the mortgage interest deduction to better target incentives; (3) expanding access to retirement accounts and automatic enrollment; and (4) promoting emergency savings while addressing barriers such as asset tests in safety net programs.
The paper looks back to time when budgeting was easier and budget outcomes were superior. Although it is impossible to replicate the past exactly, there are characteristics of past budgets that might be emulated. The focus is on Eisenhower's battles to balance the 1960 budget. At the time, almost all spending was controlled by annual appropriations, and popular, rapidly growing entitlements for old people were very much less important. The president's budget was much more influential. Approaches to gaining more control over entitlements are explored as is the more difficult task of restoring the influence of the president's budget.
The latest edition of the Tax Policy Center's State and Local Finance Initiative's State Economic Monitor reports that states are still struggling to emerge from the lingering recession. The good news is that nearly all states experienced economic growth in 2013, and only one state has an unemployment rate above 8 percent. But few states have fully recovered from the 2007 downturn, and new problems are arising. State tax revenues were down in the first quarter, driven by a significant decline in income tax revenue, and a non-government forecast estimates that the revenue drop may become even more severe. The Monitor also reviews the health of other aspects of state economies such as total employment, real earnings, and housing. This edition’s special supplement highlights a new Urban Institute report on public pension plans.