DISTRIBUTIONAL EFFECTS OF THE CHAIRMAN’S AMENDMENT

IN THE NATURE OF A SUBSTITUTE RELATING TO

THE “MARRIAGE TAX PENALTY RELIEF ACT OF 2000”

Prepared by the Staff

of the

JOINT COMMITTEE ON TAXATION

February 1, 2000

JCX-7-00
DISTRIBUTIONAL EFFECTS OF THE CHAIRMAN’S AMENDMENT IN THE NATURE OF A SUBSTITUTE 

THE "MARRIAGE TAX PENALTY RELIEF ACT OF 2000" (1)

 Calendar Year 2001

CHANGE IN FEDERAL TAXES (3) FEDERAL TAXES (3) Effec

INCOME FEDERAL UNDER UNDER Prese

CATEGORY (2) TAXES (3) PRESENT LAW PROPOSAL Law 

Millions Percent Billions Percent Billions Percent Perce

Less than $10,000......... -$17 -0.2% $7 0.4% $7 0.4% 8.6%  10,000 to 20,000......... -247 -1.0% 26 1.5% 25 1.5% 7.2%  20,000 to 30,000......... -816 -1.3% 62 3.7% 61 3.7% 12.5 30,000 to 40,000......... -1,011 -1.1% 95 5.7% 94 5.6% 16.2 40,000 to 50,000......... -977 -0.9% 105 6.3% 104 6.3% 17.5 50,000 to 75,000......... -1,896 -0.7% 276 16.6% 274 16.5% 20.1 75,000 to 100,000......... -1,289 -0.5% 246 14.8% 245 14.8% 22.6100,000 to 200,000........ -734 -0.2% 393 23.6% 392 23.7% 25.0200,000 and over........... -109 (5) 457 27.4% 457 27.5% 28.4Total, All Taxpayers..... -$7,096 -0.4% $1,665 100.0% $1,658 100.0% 21.5

Source: Joint Committee on Taxation

Detail may not add to total due to rounding.-----------------------------------------------------(1) Includes increases in the standard deduction, 15% bracket, and EIC phaseout level for married couples.(2) The income concept used to place tax returns into income categories is adjusted gross income (AGI) plus: [1] tax-exe interest, [2] employer contributions for health plans and life insurance, [3] employer share of FICA tax, [4] worker’s co [5] nontaxable social security benefits, [6] insurance value of Medicare benefits, [7] alternative minimum tax preferenc [8] excluded income of U.S. citizens living abroad. Categories are measured at 2000 levels.(3) Federal taxes are equal to individual income tax (including the outlay portion of the EIC), employment tax (attributed to  and excise taxes (attributed to consumers). Corporate income tax is not included due to uncertainty concerning the  Individuals who are dependents of other taxpayers and taxpayers with negative income are excluded from the analys Does not include indirect effects.(4) The effective tax rate is equal to Federal taxes described in footnote (3) divided by: income described in footnote (2) p income attributable to the proposal.(5) Less than 0.005%.

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DISTRIBUTIONAL EFFECTS OF THE CHAIRMAN’S AMENDMENT IN THE NATURE OF A SUBSTITUTE 

THE "MARRIAGE TAX PENALTY RELIEF ACT OF 2000" (1)

 Calendar Year 2002

CHANGE IN FEDERAL TAXES (3) FEDERAL TAXES (3) Effec

INCOME FEDERAL UNDER UNDER Prese

CATEGORY (2) TAXES (3) PRESENT LAW PROPOSAL Law 

Millions Percent Billions Percent Billions Percent Perce

Less than $10,000......... -$16 -0.2% $7 0.4% $7 0.4% 9.0%  10,000 to 20,000......... -242 -0.9% 26 1.5% 26 1.5% 7.3%  20,000 to 30,000......... -812 -1.3% 63 3.6% 63 3.6% 12.4 30,000 to 40,000......... -1,021 -1.1% 97 5.6% 96 5.5% 16.1 40,000 to 50,000......... -1,000 -0.9% 109 6.3% 108 6.3% 17.6 50,000 to 75,000......... -1,964 -0.7% 287 16.5% 285 16.5% 20.0 75,000 to 100,000......... -1,304 -0.5% 257 14.8% 256 14.8% 22.5100,000 to 200,000........ -793 -0.2% 417 24.0% 416 24.0% 25.1200,000 and over........... -118 (5) 474 27.3% 474 27.4% 28.5Total, All Taxpayers..... -$7,272 -0.4% $1,738 100.0% $1,731 100.0% 21.5

Source: Joint Committee on Taxation

Detail may not add to total due to rounding.-----------------------------------------------------(1) Includes increases in the standard deduction, 15% bracket, and EIC phaseout level for married couples.(2) The income concept used to place tax returns into income categories is adjusted gross income (AGI) plus: [1] tax-exe interest, [2] employer contributions for health plans and life insurance, [3] employer share of FICA tax, [4] worker’s co [5] nontaxable social security benefits, [6] insurance value of Medicare benefits, [7] alternative minimum tax preferenc [8] excluded income of U.S. citizens living abroad. Categories are measured at 2000 levels.(3) Federal taxes are equal to individual income tax (including the outlay portion of the EIC), employment tax (attributed to  and excise taxes (attributed to consumers). Corporate income tax is not included due to uncertainty concerning the  Individuals who are dependents of other taxpayers and taxpayers with negative income are excluded from the analys Does not include indirect effects.(4) The effective tax rate is equal to Federal taxes described in footnote (3) divided by: income described in footnote (2) p income attributable to the proposal.(5) Less than 0.005%.

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DISTRIBUTIONAL EFFECTS OF THE CHAIRMAN’S AMENDMENT IN THE NATURE OF A SUBSTITUTE 

THE "MARRIAGE TAX PENALTY RELIEF ACT OF 2000" (1)

 Calendar Year 2003

CHANGE IN FEDERAL TAXES (3) FEDERAL TAXES (3) Effec

INCOME FEDERAL UNDER UNDER Prese

CATEGORY (2) TAXES (3) PRESENT LAW PROPOSAL Law 

Millions Percent Billions Percent Billions Percent Perce

Less than $10,000......... -$17 -0.2% $7 0.4% $7 0.4% 9.3%  10,000 to 20,000......... -239 -0.9% 27 1.5% 26 1.5% 7.4%  20,000 to 30,000......... -803 -1.2% 65 3.6% 64 3.5% 12.4 30,000 to 40,000......... -1,072 -1.1% 100 5.5% 99 5.5% 16.0 40,000 to 50,000......... -1,077 -1.0% 111 6.1% 110 6.1% 17.4 50,000 to 75,000......... -2,234 -0.7% 299 16.5% 296 16.4% 19.9 75,000 to 100,000......... -2,183 -0.8% 270 14.9% 268 14.9% 22.4100,000 to 200,000........ -2,023 -0.5% 441 24.3% 439 24.3% 25.1200,000 and over........... -399 -0.1% 493 27.2% 493 27.3% 28.6Total, All Taxpayers..... -$10,047 -0.6% $1,813 100.0% $1,803 100.0% 21.5

Source: Joint Committee on Taxation

Detail may not add to total due to rounding.-----------------------------------------------------(1) Includes increases in the standard deduction, 15% bracket, and EIC phaseout level for married couples.(2) The income concept used to place tax returns into income categories is adjusted gross income (AGI) plus: [1] tax-exe interest, [2] employer contributions for health plans and life insurance, [3] employer share of FICA tax, [4] worker’s co [5] nontaxable social security benefits, [6] insurance value of Medicare benefits, [7] alternative minimum tax preferenc [8] excluded income of U.S. citizens living abroad. Categories are measured at 2000 levels.(3) Federal taxes are equal to individual income tax (including the outlay portion of the EIC), employment tax (attributed to  and excise taxes (attributed to consumers). Corporate income tax is not included due to uncertainty concerning the  Individuals who are dependents of other taxpayers and taxpayers with negative income are excluded from the analys Does not include indirect effects.(4) The effective tax rate is equal to Federal taxes described in footnote (3) divided by: income described in footnote (2) p income attributable to the proposal.(5) Less than 0.005%.

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DISTRIBUTIONAL EFFECTS OF THE CHAIRMAN’S AMENDMENT IN THE NATURE OF A SUBSTITUTE 

THE "MARRIAGE TAX PENALTY RELIEF ACT OF 2000" (1)

 Calendar Year 2004

CHANGE IN FEDERAL TAXES (3) FEDERAL TAXES (3) Effec

INCOME FEDERAL UNDER UNDER Prese

CATEGORY (2) TAXES (3) PRESENT LAW PROPOSAL Law 

Millions Percent Billions Percent Billions Percent Perce

Less than $10,000......... -$17 -0.2% $8 0.4% $8 0.4% 9.5%  10,000 to 20,000......... -237 -0.9% 27 1.4% 27 1.4% 7.3%  20,000 to 30,000......... -805 -1.2% 67 3.5% 66 3.5% 12.4 30,000 to 40,000......... -1,071 -1.0% 102 5.4% 101 5.4% 15.9 40,000 to 50,000......... -1,094 -1.0% 113 6.0% 112 6.0% 17.3 50,000 to 75,000......... -2,369 -0.8% 312 16.5% 310 16.5% 19.8 75,000 to 100,000......... -3,200 -1.1% 280 14.8% 276 14.7% 22.2100,000 to 200,000........ -3,905 -0.8% 468 24.7% 464 24.7% 25.1200,000 and over........... -830 -0.2% 517 27.3% 516 27.5% 28.8Total, All Taxpayers..... -$13,528 -0.7% $1,893 100.0% $1,880 100.0% 21.6

Source: Joint Committee on Taxation

Detail may not add to total due to rounding.-----------------------------------------------------(1) Includes increases in the standard deduction, 15% bracket, and EIC phaseout level for married couples.(2) The income concept used to place tax returns into income categories is adjusted gross income (AGI) plus: [1] tax-exe interest, [2] employer contributions for health plans and life insurance, [3] employer share of FICA tax, [4] worker’s co [5] nontaxable social security benefits, [6] insurance value of Medicare benefits, [7] alternative minimum tax preferenc [8] excluded income of U.S. citizens living abroad. Categories are measured at 2000 levels.(3) Federal taxes are equal to individual income tax (including the outlay portion of the EIC), employment tax (attributed to  and excise taxes (attributed to consumers). Corporate income tax is not included due to uncertainty concerning the  Individuals who are dependents of other taxpayers and taxpayers with negative income are excluded from the analys Does not include indirect effects.(4) The effective tax rate is equal to Federal taxes described in footnote (3) divided by: income described in footnote (2) p income attributable to the proposal.(5) Less than 0.005%.

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DISTRIBUTIONAL EFFECTS OF THE CHAIRMAN’S AMENDMENT IN THE NATURE OF A SUBSTITUTE 

THE "MARRIAGE TAX PENALTY RELIEF ACT OF 2000" (1)

 Calendar Year 2005

CHANGE IN FEDERAL TAXES (3) FEDERAL TAXES (3) Effec

INCOME FEDERAL UNDER UNDER Prese

CATEGORY (2) TAXES (3) PRESENT LAW PROPOSAL Law 

Millions Percent Billions Percent Billions Percent Perce

Less than $10,000......... -$18 -0.2% $8 0.4% $8 0.4% 9.8%  10,000 to 20,000......... -238 -0.9% 27 1.4% 27 1.4% 7.4%  20,000 to 30,000......... -789 -1.2% 67 3.4% 66 3.4% 11.3 30,000 to 40,000......... -1,138 -1.1% 105 5.3% 104 5.3% 16.0 40,000 to 50,000......... -1,216 -1.0% 119 6.0% 118 6.0% 17.7 50,000 to 75,000......... -2,603 -0.8% 320 16.2% 318 16.2% 21.6 75,000 to 100,000......... -4,795 -1.6% 294 14.8% 289 14.7% 26.1100,000 to 200,000........ -6,968 -1.4% 497 25.1% 490 25.0% 34.6200,000 and over........... -1,542 -0.3% 543 27.4% 541 27.6% 35.6Total, All Taxpayers..... -$19,307 -1.0% $1,980 100.0% $1,961 100.0% 24.7

Source: Joint Committee on Taxation

Detail may not add to total due to rounding.-----------------------------------------------------(1) Includes increases in the standard deduction, 15% bracket, and EIC phaseout level for married couples.(2) The income concept used to place tax returns into income categories is adjusted gross income (AGI) plus: [1] tax-exe interest, [2] employer contributions for health plans and life insurance, [3] employer share of FICA tax, [4] worker’s co [5] nontaxable social security benefits, [6] insurance value of Medicare benefits, [7] alternative minimum tax preferenc [8] excluded income of U.S. citizens living abroad. Categories are measured at 2000 levels.(3) Federal taxes are equal to individual income tax (including the outlay portion of the EIC), employment tax (attributed to  and excise taxes (attributed to consumers). Corporate income tax is not included due to uncertainty concerning the  Individuals who are dependents of other taxpayers and taxpayers with negative income are excluded from the analys Does not include indirect effects.(4) The effective tax rate is equal to Federal taxes described in footnote (3) divided by: income described in footnote (2) p income attributable to the proposal.(5) Less than 0.005%.

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