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_______________________________

Institute for Workplace Studies----------------- Professor Samuel B. Bacharach

School of Industrial & Labor Relations-------- Director, Institute for Workplace Studies

Cornell University

16 East 34th Street, 4th floor---------------------- Stuart Basefsky

New York, NY 10016 -------------------------------Director, IWS News Bureau

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Congressional Budget Office (CBO)

 

THE DISTRIBUTION OF HOUSEHOLD INCOME AND FEDERAL TAXES, 2010 [4 December 2013]

http://www.cbo.gov/publication/44604

or

http://www.cbo.gov/sites/default/files/cbofiles/attachments/44604-AverageTaxRates.pdf

[full-text, 36 pages]

 

The increase in the nation’s economic activity in 2010 affected households’ income, federal tax liabilities, and federal tax rates. In this report, CBO presents its estimates of the distribution of household income and federal taxes in 2010, and it compares those estimates with estimates for the preceding three decades. The report also discusses the effects of changes in tax rules on the distribution of federal taxes in 2013.

 

Contents

CBO

Summary 1

How Were Federal Taxes Distributed in 2010? 1

How Did Federal Taxes Affect the Distribution of Income in 2010? 1

How Did the Distribution of Income and Federal Taxes Change From 2009 to 2010? 1

What Are the Longer-Term Trends in the Distribution of Federal Taxes? 2

How Will Changes in Tax Rules Between 2010 and 2013 Affect

Average Federal Tax Rates? 2

Data and Methods 3

Estimates for 2010 4

Households’ Before-Tax Income 5

Average Federal Tax Rates 5

BOX: THE DISTRIBUTION OF MARKET INCOME, TRANSFERS, AND FEDERAL TAXES 6

Distribution of Federal Taxes Across the Income Scale 10

Households’ After-Tax Income 14

Trends Since 1979 15

Average Federal Tax Rates by Source 16

Average Federal Tax Rates by Income Group 17

After-Tax Income 18

Developments Since 2010 18

Overall Income Growth 19

Changes in the Distribution of Income 19

Average Federal Tax Rates for 2011 and 2012 19

Changes in Tax Rules for 2013 19

Average Federal Tax Rates Under 2013 Tax Rules 20

Appendix A: Methodology 23

 

List of Tables and Figures

Tables

1. Distribution of Before- and After-Tax Income, by Income Group, 2009 and 2010 8

2. Average Federal Tax Rates, by Income Group, 2009 and 2010 9

3. Shares of Federal Taxes, by Income Group, 2009 and 2010 13

4. Average Federal Tax Rates Under 2010 and 2013 Tax Laws, by Income Group 21

B-1. Minimum Before-Tax Income for Different Income Groups, by Household Size, 2010 28

 

Figures

1. Average Federal Tax Rates, by Income Group, 2010 2

2. Change in Before-Tax Income, by Income Group, 2009 to 2010 3

3. Average Federal Tax Rates, by Income Group, 1979 to 2010 and Under 2013 Law 4

4. Average Federal Tax Rates, by Income Group, 2009 and 2010 10

5. Shares of Before-Tax Income and Federal Taxes, by Income Group, 2010 11

6. Average Federal Tax Rates, by Income Group and Tax Source, 2010 12

7. Shares of Before- and After-Tax Income, by Income Group, 2010 15

8. Average Federal Tax Rates, 1979 to 2010 16

9. Cumulative Growth in Average After-Tax Income, by Income Group, 1979 to 2010 18

B-1. Distribution of Average Federal Tax Rates, by Income Group, 2010 29

Appendix B: Variation Within Income Groups 27

List of Tables and Figures 31

About This Document 32

 

 

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