Posted on 07/22/2002 7:47:36 AM PDT by vannrox
Citizens for Tax Justice , 202-626-3780 | June 18, 2001 |
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The vast majority of American taxpayers will see the bulk of their Bush tax cuts take effect this year, leaving only a minority of taxpayers with a significant stake in the
Effects of the final Bush tax plan in 2001 & thereafter | |||
Income Group | Average tax cut in 2001 | Average tax cut still to come | 2001 cut as % of fully- |
$ 56 | $ 10 | 85% | |
269 | 107 | 72% | |
Middle 20% | 405 | 194 | 68% |
Fourth 20% | 575 | 449 | 56% |
Next 15% | 739 | 1,416 | 34% |
Next 4% | 1,008 | 2,316 | 30% |
Top 1% | 3,120 | 50,003 | 6% |
ALL | $ 440 | $ 950 | 32% |
ADDENDUM | |||
Bottom 60% | $ 243 | $ 104 | 70% |
Top 10% | 1,121 | 6,771 | 14% |
Only the best-off fifth of the population will get most of its tax cut after 2001.
In 2001, seven percent of the total tax cuts go to the top one percent. But after 2001, more than half the remaining tax cuts will go to the top one percent.
"For most Americans, the post-2001 Bush tax cuts offer little gain, but lots of pain," said Robert S. McIntyre, director of Citizens for Tax Justice. "That's because most people will get little more in tax reductions after the first year, while losing large amounts in public services as the remaining upper-income tax cuts are phased in."
(President Bush's March budget submission envisions cutting domestic appropriations by as much as a third as a share of the economy by fiscal 2011.)
Effects of the final version of the Bush tax plan in 2001 only | ||||||||||
Income Range | Average Income | Income tax cuts ($-bill.) | Average income tax cuts | % of total 2001 tax cut | 2001 cut as % of fully-phased-in tax cuts* | Tax cuts still to come** (averages) | % of total post-2001 tax cuts | |||
Lowest 20% | Less than $15,000 | $ 9,300 | $ 1.5 | $ 56 | 2.5% | 85% | $ 10 | 0.2% | ||
Second 20% | $15,00027,000 | 20,600 | 7.0 | 269 | 12.1% | 72% | 107 | 2.2% | ||
Middle 20% | $27,00044,000 | 34,400 | 10.5 | 405 | 18.3% | 68% | 194 | 4.1% | ||
Fourth 20% | $44,00072,000 | 56,400 | 15.0 | 575 | 25.9% | 56% | 449 | 9.4% | ||
Next 15% | $72,000147,000 | 97,400 | 14.4 | 739 | 25.0% | 34% | 1,416 | 22.2% | ||
Next 4% | $147,000373,000 | 210,000 | 5.2 | 1,008 | 9.1% | 30% | 2,316 | 9.7% | ||
Top 1% | $373,000 or more | 1,117,000 | 4.1 | 3,120 | 7.0% | 6% | 50,003 | 52.2% | ||
ALL | $ 57,800 | $ 57.7 | $ 440 | 100.0% | 32% | $ 950 | 100.0% | |||
ADDENDUM |
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Bottom 60% | Less than $44,000 | $ 21,400 | $ 19.0 | $ 243 | 32.9% | 70% | $ 104 | 6.5% | ||
Top 10% | 256,000 | 14.6 | 1,121 | 25.3% | 14% | 6,771 | 70.7% | |||
The table shows the effects of the final version of the Bush tax plan on taxes due on 2001 incomes. Income tax cuts that take effect in 2001 include: reductions in the current 28%, 31%, 36%, and 39.6% rates to 27%, 30%, 35% and 38.6% for income earned after July 1, 2001; a new 10% bracket on the first $12,000 in taxable income for couples, $10,000 for single parents, and $6,000 for childless singles and married persons filing separately; an increase in the per-child credit to $600 (from $500), with expanded rules for refundability of the credit (based on 10% of earned income above $10,000); and an increase in the individual Alternative Minimum Tax exemption, equal to $4,000 for couples and $2,000 for singles. *Compared to the annual effects of the entire Bush tax plan, fully phased in, at 2001 income levels in 2001 dollars. **Average annual effects of future tax cuts when fully effective, at 2001 income levels in 2001 dollars. Source: Institute on Taxation and Economic Policy Tax Model Citizens for Tax Justice, June 18, 2001 |
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Phase-in dates for the 2001 tax act (calendar years)
This year (2001):
2002:
2003:
2004:
2005:
2006:
2007:
2008:
2009:
2010:
2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | |||
Brackets | 10% on $6,000/10,000/12,000, unindexed |
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$7,000/10,000/14,000, indexed thereafter | ||||||||||
na in 2000 | 10% | 10% | 10% | 10% | 10% | 10% | 10% | 10% | 10% | 10% | 10% | ||
15% | 15% | 15% | 15% | 15% | 15% | 15% | 15% | 15% | 15% | 15% | 15% | ||
28% | 27% | 27% | 27% | 26% | 26% | 25% | 25% | 25% | 25% | 25% | 25% | ||
31% | 30% | 30% | 30% | 29% | 29% | 28% | 28% | 28% | 28% | 28% | 28% | ||
36% | 35% | 35% | 35% | 34% | 34% | 33% | 33% | 33% | 33% | 33% | 33% | ||
39.6% | 38.6% | 38.6% | 38.6% | 37.6% | 37.6% | 35% | 35% | 35% | 35% | 35% | 35% | ||
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Per child credit (was $500 in 2000) |
$ 600 | (unindexed) | $ 700 | (unindexed) | $ 800 | $1,000, unindexed | |||||||
Refundability | 10% of earnings > $10,000 (indexed) | 15% > about $11,300 (indexed) | |||||||||||
Married SD, 01$ | 7,600 | 7,600 | 7,600 | 7,600 | 7,917 | 8,372 | 8,509 | 8,645 | 9,100 | 9,100 | 9,100 | ||
Married 15%, 01$ | 45,200 | 45,200 | 45,200 | 45,200 | 48,690 | 50,584 | 52,207 | 54,100 | 54,100 | 54,100 | 54,100 | ||
Married EITC, 01$ | 32,120 | 33,095 | 33,070 | 33,046 | 33,878 | 33,833 | 33,833 | 34,624 | 34,624 | 34,624 | 34,624 | ||
Nominal $ | +1,000 (not indexed) |
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+2,000 (not indexed) | +3,000 indexed thereafter | |||||||||
note: affects both starting & ending points for phase-out | |||||||||||||
Depend. care credit |
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to $3000/6000, 35% phase out starts at $15K (up from $2400/4800, 30% and $10K) |
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AMT exemption |
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!!! |
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Couples (+4000) | 49,000 | 49,000 | 49,000 | 49,000 | 45,000 | 45,000 | 49,000 | 49,000 | 49,000 | 49,000 | 49,000 | ||
Singles (+2000) | 35,750 | 35,750 | 35,750 | 35,750 | 33,750 | 33,750 | 35,750 | 35,750 | 35,750 | 35,750 | 35,750 | ||
Personal exemption phase-out | minus 1/3 | minus 2/3 | repealed |
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Itemized deduction disallowance | minus 1/3 | minus 2/3 | repealed | ||||||||||
Estate Tax Top rate | 55% | 50% | 49% | 48% | 47% | 46% | 45% | 45% | 45% | repealed | |||
Credit (becomes exemption) | 1 mill | 1 mill | 1.5 mill | 1.5 mill | 2 mill | 2 mill | 2 mill | 3.5 mill | repealed |
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