The effects of income tax changes on the economy and the distribution of after-tax income depend in part on the population that does not file a tax return or that does file a return but owes little or no net income tax liability. These types of tax units featured prominently in the debate over the 2003 tax legislation. The Tax Policy Center (TPC) model contains information on both tax filers and nonfiling tax units. This article describes the household composition of nonfilers and filers with modest tax liability for 2003.
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