Senior Research Methodologist
Tax Policy Center
M.A., Economics, University of California at Berkeley
B.Sc., Mathematics and Economics, University of Toronto
Preliminary Analysis of The Family Fairness and Opportunity Tax Reform Act (Research Report)
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Senator Mike Lee's Family Fairness and Opportunity Tax Reform Act (S.1616) would significantly expand tax benefits for children, repeal the alternative minimum tax, and repeal the Affordable Care Act surtaxes on earnings and net investment income. To partially offset the cost of these provisions, the plan would consolidate filing statuses and tax brackets and repeal itemized deductions other than those for charitable contributions and home mortgage interest. TPC estimates that the plan would reduce tax revenues by $2.4 trillion over the ten-year budget period, 2014-2023, and remove roughly 12 million tax units from the federal income tax rolls in 2014.
Tax Provisions in the American Taxpayer Relief Act of 2012 (ATRA) (Research Report)
|Posted to Web: March 04, 2014||Publication Date: March 04, 2014|
The fiscal cliff debate culminated in the passage of the American Taxpayer Relief Act of 2012 (ATRA). ATRA makes permanent most of the tax cuts enacted in 2001 and 2003, permanently patches the alternative minimum tax, extends for five years the enhancements to individual income tax credits originally enacted in the 2009 stimulus legislation, and temporarily extends certain other tax provisions. This paper provides a detailed description of the individual, corporate, and estate tax provisions in ATRA.
Options to Reform the Deduction for Home Mortgage Interest (Research Report)
|Posted to Web: January 09, 2013||Publication Date: January 09, 2013|
Currently, taxpayers can deduct interest on up to $1 million in acquisition debt used to buy, build, or improve their primary residence or a second designated residence. In addition, taxpayers can deduct interest on up to $100,000 in home equity loans or other loans secured by their properties regardless of the loans’ purpose. We consider a proposal that would limit the amount of deductible interest to the amount incurred on the first $500,000 of debt on a primary residence only, and would replace the itemized deduction with a nonrefundable tax credit equal to 15 percent of eligible home mortgage interest.
Options to Limit the Benefit of Tax Expenditures for High-Income Households (Research Report)
|Posted to Web: August 16, 2011||Publication Date: August 16, 2011|
This analysis measures the revenue and distributional impacts of three proposals to limit tax expenditures for higher-income households: the Obama Administration's plan to cap the value of itemized deductions at 28 percent; an effective minimum tax (EMT) to ensure that tax liability is at least a certain percentage of a taxpayer's income; and a modified version of a recent proposal to limit the value of specific tax expenditures to two percent of adjusted gross income (AGI).
Why Some Tax Units Pay No Income Tax (Research Report)
|Posted to Web: August 02, 2011||Publication Date: August 02, 2011|
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 activities—wipe 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.
Catastrophic Budget Failure (Research Report)
|Posted to Web: July 27, 2011||Publication Date: July 25, 2011|
Continuation of current U.S. fiscal policy will lead to an enormous accumulation of debt with potentially disastrous economic consequences. Exacerbated by the recent economic turmoil and fueled by the willingness of creditors to lend at very low interest rates, there is signifi cant risk that necessary fi scal reform will be put off. In this paper, we consider the causes, mechanisms, and macroeconomic fallout of a catastrophic budget failure — a situation in which markets’ perception of the credit worthiness of the U.S. government rapidly deteriorates, leaving it unable to access credit markets at any reasonable rate of interest and generating a high probability of the previously unthinkable: the U.S. government defaulting on its debt obligations.
The Impact of the Bipartisan Tax Fairness and Simplification Act of 2010 ("Wyden-Gregg") on Effective Marginal Tax Rates (Research Report)
|Posted to Web: September 01, 2010||Publication Date: September 01, 2010|
The Wyden-Gregg tax reform proposal would represent a broad reform of the federal income tax system. This paper examines the plan's impact on individuals' effective marginal tax rates (EMTR), the incremental amount of tax owed on an additional dollar of income. We examine the impact on the EMTR for both wage income and realized capital gains against current law and current policy baselines.
We find the Wyden-Gregg plan would lower the overall average EMTR on wages relative to both current law and current policy, but would raise the overall average EMTR on gains when compared with those same two baselines.
Preliminary Revenue Estimates and Distributional Analysis of the Tax Provisions in the Bipartisan Tax Fairness and Simplification Act of 2010 (Research Report)
|Posted to Web: July 14, 2010||Publication Date: July 09, 2010|
The Bipartisan Tax Fairness and Simplification Act of 2010 ("Wyden-Gregg," introduced as S. 3018) is a broad reform of the federal income tax system. Some provisions would also expand the Social Security payroll tax base. This paper presents the Tax Policy Center's estimates of the revenue and distributional effects of the income and payroll tax provisions in Wyden-Gregg.
Variation in Effective Tax Rates (Article/Tax Facts)
|Posted to Web: May 24, 2010||Publication Date: May 24, 2010|
The expansion of refundable tax credits and the proliferation
of specialized tax breaks means that households
with similar incomes can face wildly different
effective federal tax rates. For example, among middle-income
households, the median effective income tax rate
is 3 percent, but 10 percent of those households face
effective rates exceeding 9 percent and another 10 percent
receive a net government subsidy greater than 4 percent
of their cash income.
The Individual Alternative Minimum Tax: Historical Data and Projections, Updated October 2009 (Research Report)
|Posted to Web: February 22, 2010||Publication Date: February 08, 2010|
The alternative minimum tax (AMT), which originally targeted high-income taxpayers, requires annual legislation to prevent it from affecting millions of middle-income individuals each year. There are two primary reasons for the AMT’s broadening impact; its parameters are not indexed for inflation and the 2001-2006 tax cuts reduced regular tax liability without changing AMT liability. In 2009, four million taxpayers will pay $33.5 billion in AMT, but without congressional action that number will rise to 27 million owing $102 billion in 2010. This paper describes the AMT and provides TPC’s latest estimates of AMT coverage, revenue, and distribution.
|Posted to Web: October 05, 2009||Publication Date: October 05, 2009|
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