Tax Relief in 2001 through 2011 

Department of the Treasury 

May 2008 
Tax Relief in 2001 through 2011 

The tax relief enacted during the President’s term in office, principally in the Economic Growth and Tax 

Relief Reconciliation Act of 2001, the Jobs and Growth Tax Relief Reconciliation Act of 2003, the 

Working Families Tax Relief Act of 2004, the American Jobs Creation Act of 2004, the Tax Increase 

Prevention and Reconciliation Act of 2005, and the Economic Stimulus Act of 2008, reduced taxes for 

everyone who pays income taxes as well as for business taxpayers. This document provides estimates of 

the aggregate tax reduction provided by the tax relief as well as estimates of the tax reduction received by 

representative taxpayers over the period 2001 through 2011. 

Aggregate Tax Relief 

The table below provides estimates of the aggregate reduction in taxes for both individuals and businesses 

resulting from legislation enacted during the President’s term in office. The total tax relief is over $2 

trillion. The tax relief initially peaked in 2004 due to the effects of the temporary 30-percent bonus 

depreciation enacted in 2001 and expanded to 50 percent in 2003. The tax relief again peaks in 2008 due 

to the economic stimulus payments and temporary 50-percent bonus depreciation enacted in the Economic 

Stimulus Act of 2008. While the main provisions of the tax relief are currently scheduled to expire at the 

end of 2010, tax revenue effects continue into 2011 because some provisions enacted during the period do 

not terminate,1

 because of assumed income shifting effects (e.g., taxpayers shifting capital gains and other 

taxable income from 2011 into 2010 to take advantage of the lower tax rates), and because some of the 

benefits of tax relief in 2010 will be reflected on returns filed in 2011.2

Aggregate Tax Relief in 2001 through 2011

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2001-2011

Calendar Years in Billions of Dollars

85 134 219 265 179 184 234 312 205 162 38 2017

Note: Includes the impact of all tax legislation enacted from 2001 through 2008, notably:

The Economic Growth and Tax Relief Reconciliation Act of 2001

The Jobs and Growth Tax Relief Reconciliation Act of 2003

The Working Families Tax Relief Act of 2004

The American Jobs Creation Act of 2004

The Tax Increase Prevention and Reconciliation Act of 2005

The Pension Protection Act of 2006

The Economic Stimulus Act of 2008

 

1

 For example, the Pension Protection Act of 2006 made permanent the pension and IRA provisions of the Economic Growth 

and Tax Relief Reconciliation Act of 2001. 

2

 The estimates in the table include only enacted legislation. Hence, the figures do not include the effect of extending the socalled “AMT patch” through 2008, which would add an additional $58 billion of tax relief in that year. 
Tax Relief for Example Taxpayers 

The tables on the following pages show estimates of the tax reduction from the President’s tax relief 

received by representative taxpayers over the period 2001 through 2011. The estimates take into account 

the effects of the new 10-percent tax bracket (including the 2001 rate-reduction credit), the lower tax rates, 

the larger standard deduction for joint returns, the marriage penalty relief, the larger child credit and 

additional refundable child tax credit, the higher phase-out floor in the earned income tax credit for joint 

returns, the higher alternative minimum tax (AMT) exemption levels, the allowance of personal tax credits 

to be taken against the AMT, and the 2008 economic stimulus payments. 

The first table, for example, shows the tax relief received by a four-person, one earner family with two 

children and real (inflation adjusted) wages equivalent to $40,000 in 2007. Over the entire period, the 

family receives tax relief aggregating to $19,016. The tax relief is highest in 2008 because of the 

economic stimulus payments enacted in the Economic Stimulus Act of 2008. When the tax relief ends 

after 2010, this taxpayer would experience a tax increase of $2,345 in 2011 compared to the effects if the 

tax relief had continued. 

The additional tables can be interpreted similarly for the other example taxpayers. 
Tax Relief 2001 through 2011

Four-Person, One Earner Family with Wage Income

Each Year of $40,000 in 2007 Dollars

Federal Income Tax ($)

Pre-EGTRRA or

Post-2010 

Sunset

Actual

under

Tax Relief

2001 34,200 1,250 450 800

2002 34,700 1,228 428 800

2003 35,500 1,303 503 800

2004 36,400 1,378 -570 1,948

2005 37,700 1,490 -495 1,985

2006 38,900 1,565 -445 2,010

2007 40,000 1,625 -428 2,053

2008 41,100 1,700 -2,283 3,983

2009 41,900 1,715 -599 2,314

2010 42,900 1,805 -519 2,324

2011 43,900 1,858 1,858 0

TOTAL 16,915 -2,101 19,016

Federal Income Tax ($)

With Sunset With Extension

2011 43,900 1,858 -487 2,345

Income

($)

Tax

Reduction

($)

Tax Increase

Without Extension

Year Income

($)

Assumptions: All income is from wages and salaries. Itemized deductions are 18% of 

income, and the taxpayer takes the larger of itemized deductions or the standard

deduction. Beginning for 2009, the alternative minimum tax (AMT) exemptions revert

to their permanent levels of $33,750 for unmarried taxpayers and $45,000 for married

taxpayers filing jointly.The tax and the tax reduction shown for 2008 reflect the economic

stimulus payment provided under the Economic Stimulus Act of 2008.
Tax Relief 2001 through 2011

Four-Person, One Earner Family with Wage Income

Each Year of $80,000 in 2007 Dollars

Federal Income Tax ($)

Pre-EGTRRA or

Post-2010 

Sunset

Actual

under

Tax Relief

2001 68,300 5,661 4,861 800

2002 69,400 5,736 4,936 800

2003 71,000 5,903 5,103 800

2004 72,900 6,107 4,392 1,715

2005 75,400 6,354 4,624 1,730

2006 77,800 6,589 4,834 1,755

2007 80,000 6,854 5,018 1,836

2008 82,100 7,341 3,396 3,945

2009 83,800 7,735 5,735 2,000

2010 85,800 8,199 6,199 2,000

2011 87,700 8,639 8,639 0

TOTAL 75,118 57,737 17,381

Federal Income Tax ($)

With Sunset With Extension

2011 87,700 8,639 6,639 2,000

Income

($)

Tax

Reduction

($)

Year Income

($)

Assumptions: All income is from wages and salaries. Itemized deductions are 18% of 

income, and the taxpayer takes the larger of itemized deductions or the standard

deduction. Beginning for 2009, the alternative minimum tax (AMT) exemptions revert

to their permanent levels of $33,750 for unmarried taxpayers and $45,000 for married

taxpayers filing jointly.The tax and the tax reduction shown for 2008 reflect the economic

stimulus payment provided under the Economic Stimulus Act of 2008.

Tax Increase

Without Extension
Tax Relief 2001 through 2011

Three-Person, One Earner Family with Wage Income

Each Year of $40,000 in 2007 Dollars

Federal Income Tax ($)

Pre-EGTRRA or

Post-2010 

Sunset

Actual

under

Tax Relief

2001 34,200 2,185 1,485 700

2002 34,700 2,178 1,478 700

2003 35,500 2,260 1,560 700

2004 36,400 2,343 895 1,448

2005 37,700 2,470 985 1,485

2006 38,900 2,560 1,050 1,510

2007 40,000 2,635 1,083 1,553

2008 41,100 2,725 -348 3,073

2009 41,900 2,755 1,143 1,613

2010 42,900 2,853 1,223 1,630

2011 43,900 2,920 2,920 0

TOTAL 27,883 13,473 14,410

Federal Income Tax ($)

With Sunset With Extension

2011 43,900 2,920 1,265 1,655

Income

($)

Tax

Reduction

($)

Tax Increase

Without Extension

Assumptions: All income is from wages and salaries. Itemized deductions are 18% of 

income, and the taxpayer takes the larger of itemized deductions or the standard

deduction. Beginning for 2009, the alternative minimum tax (AMT) exemptions revert

to their permanent levels of $33,750 for unmarried taxpayers and $45,000 for married

taxpayers filing jointly.The tax and the tax reduction shown for 2008 reflect the economic

stimulus payment provided under the Economic Stimulus Act of 2008.

Year Income

($)
Tax Relief 2001 through 2011

Head of Household with Two Children and Wage Income

Each Year of $30,000 in 2007 Dollars

Federal Income Tax ($)

Pre-EGTRRA or

Post-2010 

Sunset

Actual

under

Tax Relief

2001 25,600 -836 -1,536 700

2002 26,000 -997 -1,697 700

2003 26,600 -926 -1,626 700

2004 27,300 -880 -2,390 1,510

2005 28,300 -756 -2,279 1,523

2006 29,200 -743 -2,280 1,538

2007 30,000 -841 -2,401 1,560

2008 30,800 -803 -3,576 2,773

2009 31,400 -934 -2,524 1,590

2010 32,200 -866 -2,469 1,603

2011 32,900 -883 -883 0

TOTAL -9,465 -23,660 14,195

Federal Income Tax ($)

With Sunset With Extension

2011 32,900 -883 -2,498 1,615

Tax

Reduction

($)

Tax Increase

Without Extension

Year Income

($)

Assumptions: All income is from wages and salaries. Itemized deductions are 18% of 

income, and the taxpayer takes the larger of itemized deductions or the standard

deduction. Beginning for 2009, the alternative minimum tax (AMT) exemptions revert

to their permanent levels of $33,750 for unmarried taxpayers and $45,000 for married

taxpayers filing jointly.The tax and the tax reduction shown for 2008 reflect the economic

stimulus payment provided under the Economic Stimulus Act of 2008.

Income

($)