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Individual income tax rates and tax shares, 2000
David CampbellTaxpayers filed 129.4 million individual income tax returns for Tax Year 2000, of which more than 96.8 million, or 74.8 percent, showed some income tax liability. The average tax rate on all taxable returns increased 0.4 percentage points from 1999 to 16.1 percent in 2000. On these taxable returns, the average adjusted gross income (less deficit) (AGI) rose 6.4 percent to $62,832, while, average total income tax increased 9.1 percent to $10,129. Total AGI reported on taxable returns increased 9.0 percent to $6,083 billion, while total income tax increased 11.8 percent to $981 billion. The alternative minimum tax (AMT) rose 48.2 percent to $9.6 billion, its highest level ever.
For the ninth consecutive year, the percent of total income tax reported by the top 5 percent of taxpayers increased, reaching 56.5 percent for 2000. The top 5 percent of taxpayers accounted for 35.3 percent of AGI for 2000, an increase of 1.3 percentage points from 1999. To be included in the top 5 percent, a taxpayer had to have an AGI of at least $128,336. The percent of AGI reported by the top 1 percent of taxpayers for 2000, those with AGI of at least $313,469, increased for the seventh consecutive year to 20.8 percent, while the same group accounted for 37.4 percent of the total income tax, up from 36.2 percent in 1999. The minimum AGI required to be included in the top 0.1 percent of taxpayers was almost $1.6 million for 2000. These taxpayers reported 10.6 percent and 19.0 percent of the total for adjusted gross income and total income tax, respectively.
This article discusses the individual income tax rates and tax shares and the computation of "total income tax" for 2000. To put this discussion into perspective, the appendices to the article provide explanations of selected terms used in the article and describe the income tax structure, certain tax law changes, income and tax concepts (the "1979 Income Tax Concept," "modified" taxable income, and marginal tax rates), the computation of "alternative minimum taxable income," and the data sources and limitations.
Income Tax Rates
Discussions of income tax rates generally center on measuring two distinct tax rates: average tax rates and marginal tax rates. Average tax rates are calculated by dividing some measure of tax by some measure of income. For the statistics in this article, the average tax rate is "total income tax" (see Appendix A: Explanation of Selected Terms) divided by AGI reported on returns showing some income tax liability. Measures of marginal tax rates, on the other hand, focus on determining the tax rate imposed on the last (or next) dollar of income received by a taxpayer. For this article, the marginal tax rate is the statutory rate at which the last dollar of taxable income is taxed. (See Appendix D for a more detailed explanation of marginal tax rates.) The following sections describe the measurement of the average and marginal tax rates in more detail, and discuss the statistics based on these rates for 2000.
Average Tax Rates
Figure A presents statistics for 1986 through 2000 on income (based on each year's definition of AGI and on the common 1979 Income Concept) and taxes reported. (See Appendix D for an explanation of the 1979 Income Concept.) These tax years can be partitioned into six distinct subperiods:
(1) Tax Year 1986 was the last year under the Economic Recovery Tax Act of 1981 (ERTA81). The tax bracket boundaries, personal exemptions, and standard deductions were indexed for inflation, and the maximum tax rate was 50 percent.
(2) Tax Year 1987 was the first year under Tax Reform Act of 1986 (TRA86). For 1987, a 1-year, transitional, five-rate tax bracket structure was established with a partial phase-in of new provisions that broadened the definition of AGI. The maximum tax rate was 38.5 percent.
(3) During Tax Years 1988 through 1990, there was effectively a three-rate tax bracket structure [1]. The phase-in of the provisions of TRA86 continued with a maximum tax rate of 33 percent.
(4) Tax Years 1991 and 1992 brought a three-rate tax bracket structure (with a maximum tax rate of 31 percent), a limitation on some itemized deductions, and a phaseout of personal exemptions.
(5) Tax Years 1993 through 1996 had a five-rate tax bracket structure (with a maximum statutory tax rate of 39.6 percent), a limitation on some itemized deductions, and a phaseout of personal exemptions.
(6) Tax Years 1997 through 2000 were subject to the Taxpayer Relief Act of 1997 (TRA97). TRA97 added three new capital gain tax rates to the previous rate structure to form a new eight-rate tax bracket structure (with a maximum statutory tax rate of 39.6 percent). See Appendix C for more detailed description of the capital gain rates.
More than 96.8 million, or 74.8 percent, of the 129.4 million individual returns filed for 2000 were "taxable returns." Total AGI for these returns increased 9.0 percent to $6,083 billion. Using the 1979 Income Concept, taxable returns showed total income of $6,294 billion, an increase of 9.7 percent from 1999. Using either measure, this increase in income was the largest since 1997. Taxpayers reported $981 billion in total income tax for 2000, approximately $104 billion (11.8 percent) more than for 1999. This represents an increase over the 11.3-percent increase for 1999 and marks the fourth out of the previous 5 years that growth in the income tax has exceeded 11 percent.
Average total income tax and average AGI for those paying income tax increased from 1999 to 2000, in both current and constant 1982-84 dollars [2]. In current dollars, average tax increased 9.1 percent to $10,129, some 2.5 percentage points more than growth in average AGI, which increased 6.4 percent to $62,832. In constant 1982-84 dollars, after adjusting for inflation, average AGI rose 3.0 percent to $36,488, and average total income tax increased 5.6 percent to $5,882.
Because TRA86 reduced statutory tax rates and broadened the definition of AGI (by eliminating or limiting the preferential treatment of various tax items, such as restricting the use of "passive losses" to offset "non-passive income" and including all net long-term capital gains), comparisons of average tax rates before and after 1986, based on current-year definitions of AGI, become less meaningful [3]. The 1979 Income Concept provides a more consistent basis for such comparisons. Based on the 1979 Income Concept, average tax rates declined 0.1 percentage point from 13.6 percent for 1986 to 13.5 percent for 1987, increased to 13.7 percent for 1988, and declined for the next 3 years, until reaching 13.2 percent for 1991. The average tax rate rose to 13.4 percent for 1992, to 13.9 percent for 1993, and continued to increase to 15.1 percent for 1997 before declining slightly to 14.9 percent for 1998, its first decline since 1991. In 1999, the average tax rate resumed its upward trend and reached 15.6 percent of taxpayer income for 2000.
As shown in Figure B, the average tax rate (as a percentage of AGI) on all taxable returns was 16.1 percent for 2000. The average tax rate for the AGI-size classes ranged from only 4.5 percent for the "$1 under $10,000" AGI-size class to 28.3 percent for the "$500,000 under $1,000,000" AGI-size class. The progressive nature of the income tax is readily apparent in Figure B, with the only exception being the "$1,000,000 or more" AGI-size class whose average tax rate is 0.6 percentage points less than the "$500,000 under $1,000,000" AGI-size class. This lower average tax rate is due to 41.6 percent of AGI reported by taxpayers in the "$1 million or more" AGI class being in the form of long term capital gain (less loss), which is taxed at a lower rate than ordinary income. The comparable figure for taxpayers in the "$500,000 under $1,000,000" AGI-size class was 20.3 percent, which explains that much of their income was taxed at a higher rate. The total average tax rate of 16.1 percent for 2000 was an increase of 0.4 percentage points over the 15.7 percent reported for 1999. Most of this increase was due to taxpayers moving into the top three AGI-size classes where, due to the previously mentioned progressive nature of the income tax, the average tax rate is significantly higher than in the lower AGI-size classes. Specifically, both the "$200,000 under $500,000" and "$500,000 under $1,000,000" AGI-size classes showed increases in the number of taxable returns of 13.8 percent for 2000, while the number of taxable returns in the "$1,000,000 or more" AGI-size class increased 16.8 percent. Even though the average tax rate itself either fell or remained unchanged for most of the AGI-size classes (it increased slightly for the "$1 under $10,000" and "$50,000 under $100,000" classes), the movement of taxable returns into higher AGI-size classes led to an increase in the average tax rate for all returns. The 16.1-percent average tax rate for 2000 marks the ninth consecutive year that the average tax rate has increased.
Marginal Tax Rate Classifications
A return's marginal tax rate is the highest statutory tax rate bracket applicable to that tax return. Marginal tax rate statistics are presented in Figures C and D and in Table 1. These statistics were based on individual income tax returns showing an amount for "tax generated" on taxable income and items of income that were subject to the regular income tax, generally those included in AGI [4]. Tables 2 and 3 contain additional data based on marginal tax rates. These tables present statistics on the income and tax generated at each marginal tax rate by size of AGI (Table 2) and by filing status (Table 3). Appendix D explains the details of the determination of the marginal tax rate bracket into which a return is assumed to fall.
For 2000, the 105.3 million individual returns with modified taxable income totaling $4,544.2 billion generated $1,008.6 billion in income taxes before credits. Figure C presents the amounts and percentages of modified taxable income and income tax generated (before reduction by tax credits, including the earned income credit) by the marginal rate categories (defined in Appendix D). The 64.9 percent of the returns with modified taxable income were in the "15-percent" and "15-percent (Form 8814)" marginal rate categories, and generated only 15.0 percent of the tax while having 22.3 percent of the modified taxable income. Conversely, the 0.9 percent of returns in the "39.6-percent" classification reported 20.9 percent of the modified taxable income while paying 29.6 percent of the tax. The 25.9 percent of returns in the "28-percent" and "28-percent (capital gains)" categories reported 34.2 percent of the modified taxable income and 29.6 percent of the tax. Returns in the "31-percent" classification reported 10.4 percent of the modified taxable income and 11.1 percent of the income tax. Returns in the "36-percent" classification showed 8.1 percent of the modified taxable income and 9.9 percent of the income tax. Other than capital gains, the remaining returns--those in the "Form 8615" category--reported 0.1 percent of the modified taxable income and 0.1 percent of the income tax generated.
The three capital gain rate classifications that were created under TRA97, "10 percent," "20 percent," and "25 percent," reported just 3.9 percent of the modified taxable income and 3.1 percent of the income tax for 2000. As shown in Table 2, some 10.2 percent of returns had modified taxable income taxed at "20 percent" which accounted for 10.9 percent of the modified taxable income and 9.8 percent of the income tax. Also, 8.9 percent of returns (had modified taxable income) taxed at the "10-percent" rate which accounted for only 0.9 percent of modified taxable income and 0.4 percent of income tax. The returns with income taxed at the "25-percent" rate classification accounted for only 0.4 percent of returns, while both the modified taxable income and income tax reported at this rate were 0.2 percent of the aggregates.
Figure D illustrates changes in the distributions of percentages of tax returns, modified taxable income, and income tax generated among various marginal tax rate classifications over Tax Years 1998, 1999, and 2000. Over the 3-year period, the percentage of returns in the "15-percent" marginal tax rate category decreased 2.6 percentage points, while the remaining seven marginal tax rate categories either increased or remained the same. During this 3-year period, the largest changes in the percentage shares of modified taxable income and income tax generated occurred in the "15-percent," "28-percent," and "39.6-percent" categories. The percentage shares of modified taxable income declined in both the "15-percent" and "28-percent" categories by 3.4 and 1.3 percentage points, respectively, and increased by 3.0 percentage points in the "39.6-percent" category. Similar to the changes in the percentage shares of modified taxable income, the percentage shares of income tax generated for the "15-percent" categories decreased by 2.8 percentage points, and the "28-percent" categories decreased by 2.0 percentage points. The percentage share of income tax generated for the "39.6-percent" category increased 3.8 percentage points. The three marginal tax rate categories introduced under TRA97, "10-percent," "20-percent," and "25-percent," had little impact on the distribution of returns, modified taxable income, or tax generated.
Components of Total Income Tax
Regular Tax
Regular tax is generally tax determined from a taxpayer's taxable income based on statutory tax rates less any applicable tax credits. It does not include the "alternative minimum tax" (AMT). Figure E illustrates the derivation of aggregate total income tax for 2000 returns with modified taxable income. Table 1 includes two tax amounts: "tax generated" and "income tax after credits." Tables 5 through 8 and Figures A and B include an additional measure of tax, "total income tax."
As shown (Figure E and column 5 of Table 1), the tax generated by applying statutory income tax rates to modified taxable income was $1,008.6 billion. For most taxpayers, tax generated was equal to income tax before credits. However, for some taxpayers, income tax before credits included the alternative minimum tax (AMT) and/or special taxes on lump-sum distributions from qualified retirement plans (when a 10-year averaging method was used) [5]. This was the first year that the AMT was calculated before personal credits were taken, thus possibly reducing the AMT burden on some taxpayers. The earned income credit (EIC) is included in this computation to the extent that its application did not reduce income tax before credits below zero. Any portion of the EIC that is refundable to the taxpayer because it exceeds the taxpayer's liability and any portion of the EIC used to reduce taxes other than income taxes are excluded from the computation of income tax after credits [6]. Income tax after credits (Figure E) totaled $980.5 billion. Total income tax of $980.6 billion is the sum of income tax after credits and tax on trusts accumulation distributions [7].
Table 4 provides estimates on the type of tax computation for returns with modified taxable income. For 2000, the number of children under age 14 who filed Form 8615 for reporting investment income over $1,400 decreased 5.1 percent to 545,600. Using Form 8615 to compute their tax (as if their income were treated as the marginal income of their parents or guardians), these children generated over $1.1 billion (column 7) of tax revenue which is $100.6 million (column 8) of tax more than the $1.0 billion (column 6) of tax that would have been levied using the ordinary tax computation.
For 2000, the 17.1 million returns subjected to the Schedule D capital gain tax computation generated $440.3 billion in tax (column 7). However, if long-term capital gains had been taxed the same as ordinary income, the amount of income tax before credits (regular tax computation) for these same taxpayers would have been $512.9 billion (column 6). Therefore, the reduction in tax generation resulting from use of the Schedule D tax computation was $72.6 billion (column 8), an increase of 23.2 percent over the $58.9-billion reduction shown for 1999 (column 4) when 16.9 million taxpayers received some benefit from lower capital gain taxes (column 1). This large increase in tax savings was due largely to the 16.2-percent increase in capital gains for 2000, which was especially concentrated in the $1 million or more AGI class.
Alternative Minimum Tax
The Revenue Act of 1978 established the alternative minimum tax to ensure that a minimum amount of income tax was paid by taxpayers who might otherwise use certain provisions of the tax code meant to stimulate economic activity and generate "economic income" to reduce, or even eliminate, their regular tax liabilities. The AMT provisions may recapture some of these tax reductions by recomputing income to achieve "alternative minimum taxable income," or AMTI, the tax base for AMT. Form 6251, Alternative Minimum Tax--Individuals, is used to calculate AMT. (See Appendix E for an explanation of the computation of AMTI.)
Figure F presents statistics, by size of AGI, on the AMT reported by taxpayers filing Form 6251 with their returns. For 2000, an AMT liability of $9.6 billion was reported based on AMTI of $1.1 trillion. This represented an increase of 22.8 percent over the $890.8 billion reported for 1999. Generally, AMTI is only shown on filed tax returns if the taxpayer's liability is affected by the AMT. The AMT amount for 2000 represents a 48.2-percent increase from the $6.5 billion in AMT for 1999. Over the past few years, net long-term capital gain (less loss) has shown a significant increase. Although long-term capital gains are taxed at the same rate for both the AMT and "ordinary" tax, any increased capital gains may have generated additional State and local income taxes, which are deductible for ordinary tax purposes but added back to income for AMT purposes. This differential treatment of State and local taxes has the effect of raising AMT liability as capital gains realizations increases. Also, the large increase in alternative minimum tax is at least partially attributable to the fact that the AMT exemption amount, the AMT income level at which the rate increases from 26 percent to 28 percent, and the phaseout of the AMT exemption are not indexed for inflation, while the regular income tax brackets and sizes of personal exemptions are inflation-adjusted. Thus, year-to-year inflation may cause more taxpayers to be affected by the AMT and the amount of AMT liability to increase. Even if this inflation does not cause an AMT liability, it may reduce or eliminate the ability to take certain tax credits. These credits include all general business credits, prior-year minimum tax credit, empowerment zone credit, mortgage interest credit, and the nonconventional source fuel credit.
Figure G shows the highest marginal tax rates on ordinary income, capital gains, and AMTI for each of the years 1986 through 2000. The amount of AMT reported for each of the 14 years is also shown. For 1986, after TRA86 was introduced but before it became effective, when the highest marginal tax rate on ordinary income was 50 percent, and the highest capital gain rate and AMT rates were both 20 percent, the AMT reported was $6.7 billion. After 1986, both the highest capital gain rate and the highest AMT rate increased, while the highest marginal ordinary tax rate declined. In addition, capital gains were fully included in AGI. For 1987, AMT decreased dramatically to $1.7 billion. From 1988 to 1990, AMT revenue continued to decrease, to a low of $830.3 million for 1990. For 1991, when the AMT rate increased to 24 percent, the AMT increased 46.1 percent to $1.2 billion. From 1992 to 1993, when the highest marginal tax rate on ordinary income and the highest AMT rate increased again (while the highest capital gain rate remained the same), the AMT liability increased 51.3 percent to nearly $2.1 billion. From 1994 through 1996, the amount of the AMT increased gradually every year. But for 1997, the AMT began a 4-year trend of very substantial growth until it totaled more than $9.6 billion for 2000, some 2.4 times the amount reported for 1996. This also coincides with a large increase in the number of taxpayers subject to the AMT, which almost tripled from just under 478,000 for 1996 to more than 1.3 million for 2000. In 2000, the amount of AMT increased 48.2 percent to $9.6 billion, following the 29.2-percent increase in 1999. Of all returns filed, 1.0 percent of taxpayers paid AMT in 2000, the highest percentage since the imposition of the AMT.
Income and Tax Shares
Historical statistics on income and tax by cumulative percentiles (based on numbers of returns) are presented in Tables 5 through 8. Distributions of AGI, as defined for each year and tax or income item, by descending and ascending cumulative percentiles of returns, are presented in Tables 5 and 6. These tables can be used to make comparisons across cumulative percentile classes within each year, among years within the ERTA81 period (i.e., Tax Years 1982 through 1986), and among years within the post-TRA86 period (i.e., Tax Years 1987 through 2000). Since TRA86 redefined AGI, Tables 5 and 6 are not as useful for comparisons between pre- and post-TRA86 years. Thus, Tables 7 and 8, which are based on a consistent definition of income (i.e., using the 1979 Income Concept), are included to facilitate such comparisons.
Tables 5 and 7, and Figure H are based on percentiles of returns cumulated downward from the highest income returns. The data in Tables 5 and 7 are shown for the top 1, 5, 10, 25, and 50 percent of returns, while data shown in Figure H are for the top 0.1, 1, 2, 3, 4, and 5 percent of returns. Tables 6 and 8 are based on returns cumulated upward for the lowest income returns. Data are shown for the bottom 50, 75, 90, 95, and 99 percent of all returns.
For example, consider the data in Table 5 for the 128.2 million returns filed for 2000 with positive AGI [8]. The average tax rate for these returns was 15.3 percent, representing a 0.4-percentage-point increase from 1999 and the highest level since 1981. The average tax rate on the top 1 percentile decreased slightly for 2000, while the average tax rate on the 5, 10, 25, and 50 percentiles increased from 2000. The 1, 5, 10, 25, and 50 percentiles all recorded a larger share of the income tax burden than their respective shares of AGI. For 2000, the returns in the top 1 percentile reported 20.8 percent of total AGI and 37.4 percent of total income tax. The amount of AGI needed for inclusion in this percentile group (i.e., the AGI floor) was $313,469. For 1999, the returns in this percentile group (i.e., those with at least $293,415 in AGI) reported 19.5 percent of total AGI and 36.2 percent of total income tax. For 2000, the returns in the top 5 percentile group (returns reporting AGI of $128,336 or more) reported 35.3 percent of total AGI and 56.5 percent of total income tax, higher than the 34.0 percent and 55.5 percent, respectively, for 1999 (when the AGI floor was $120,846). For 2000, returns in the top-10 percentile group (returns with AGI of at least $92,144) showed 46.0 percent of AGI and 67.3 percent of total income tax. For 1999, the returns in this percentile group (with AGI of $87,682 or more) reported 44.9 percent of total AGI and 66.5 percent of total income tax. The top-50 percentile group accounted for 87.0 percent of income and 96.1 percent of the income tax for 2000. Figure I presents statistics for the 128,227 returns that were classified in the top 0.1 percentile of returns based on AGI. The average tax rate on these returns was 27.4 percent for 2000. These returns reported earnings consisting of 10.6 percent of total AGI, while paying 19.0 percent of the total income tax.
The statistics by percentile in Tables 5 and 6 for years prior to 1991 and Tables 7 and 8 for years prior to 1994 were estimated, using a mathematical technique called "osculatory interpolation," applied to aggregated data tabulated by income-size classes, in order to distribute the tax returns within each class [9]. For 1991 and later years, the statistics by percentiles in Tables 5 and 6 and Tables 7 and 8 for 1994 through 2000 were computed, based on an actual ranking of the returns in the statistical sample that served as the basis for Individual Statistics of Income estimates. The differences under the two methods were judged to be minor enough so that the pre-1991 and post-1990 data are believed to be comparable.
Figure J presents percentage shares of income and total income tax for various percentile groups, using the 1979 Income Concept, for 1986 through 2000. While shares of income for the top 1 percent and bottom 50 percent of taxpayers have been close over the years, 2000 marks the sixth consecutive year that that the income shares of the top 1 percent of taxpayers were higher than the corresponding shares of the bottom 50 percentile. The income share for the top 1 percent of taxpayers entered its sixth year of growth, reaching 21.6 percent for 2000, while the share of income for the bottom 50 percent of taxpayers continued to slide over the same period, falling to 12.8 percent. This 8.8-percentage point difference constitutes the largest difference in income shares between the two percentile groups over the previous 15 years. Similarly, the shares of total income tax for the top 1 percent and bottom 50 percent of taxpayers have diverged over time. The total income tax shares for the top 1 percent have risen from a low of 24.1 percent for 1991 to a high of 36.3 percent for 2000. Shares of total income tax for the bottom 50 percent of taxpayers have decreased from 6.7 percent for 1986 to just under 4.0 percent for 2000. The difference between the income tax shares of these two groups reached 32.3 percentage points for 2000, marking the largest difference between the two groups over the past 15 years. The shares of income for the top 5 percent and bottom 75 percent of taxpayers converged during the 1990's; however, beginning in 1998, the difference between these two groups began to grow. Income shares increased from 28.4 percent for 1986 to 36.8 percent for 2000 for the top 5 percent of taxpayers and decreased from 38.2 percent for 1986 to 31.9 percent for 2000 for the bottom 75 percent of taxpayers. Shares of total income tax for the top 5 percent and bottom 75 percent of taxpayers have consistently diverged over the past 15 years. Percentage shares of total income tax for taxpayers in the top 5 percentile rose from 42.4 percent for 1986 to a high of 55.7 percent for 2000, while shares of total income tax for the bottom 75 percent of taxpayers have decreased from 24.3 percent for 1986 to a low of 16.4 percent for 2000. The gap between the income tax shares of these two groups reached a 15-year high of 39.3 percentage points for 2000.
[FIGURE J OMITTED]
Appendix A: Explanation of Selected Terms This appendix provides brief explanations of the major tax concepts discussed. For more extensive definitions, see Section 4 in Campbell and Parisi, "Individual Income Tax Returns, 2000," Statistics of Income Bulletin, Fall 2002, Volume 22, Number 2.
Adjusted Gross Income.--Adjusted gross income is "total income," as defined by the tax code, less "statutory adjustments" (primarily business, investment, or certain other deductions, such as payments to a Keogh self-employed retirement plan, certain deductible contributions to an Individual Retirement Arrangement (IRA), self-employed health insurance deductions, and one-half of Social Security taxes for the self-employed). Total income includes, for example, salaries and wages, taxable interest, dividends, alimony, and net amounts from such sources as business income, rents and royalties, and sales of capital assets.
Difference Due to Special Tax Computation.--For this article, the tax difference is the amount of tax resulting from using provisions of one of the special tax computations (Form 8615 or Schedule D) less the amount of tax that would have resulted from not having used any of these provisions (regular tax computation).
Form 8615 Tax Computation.--Form 8615 was used to compute the tax on investment income of children under age 14 who had investment income of more than $1,400. Generally, such income was taxed at the marginal tax rate of the parents.
Income Tax Before Credits.--This amount consisted of the tax liability on taxable income, computed by using the tax tables, tax rate schedules, Schedule D Tax worksheet, Schedule J, or Form 8615, plus Form (s) 8814, and any additional taxes from Form 4972. Beginning in Tax Year 2000, this amount also includes the Alternative Minimum Tax.
Income Tax Before Credits (Regular Tax Computation).--This amount consisted of the tax liability on ordinary income, computed by using the tax table or applying the rates from one of the four tax rate schedules, plus any additional tax (tax on lump-sum distributions from qualified retirement plans). When Form 8615 tax was payable on investment income of children, for this concept, all the income was taxed at the child's rate rather than at the rate of the parents. When the Schedule D tax was payable on net long-term capital gains, the tax was based on the regular tax rates rather than the 10, 20, 25, or 28-percent tax rate for capital gains. This is in contrast to the computation of Income Tax Before Credits (see above) in which special tax computations such as those involved on the Form 8615 and Schedule D are taken into account. See Table 4.
Marginal Tax Rate.--See Appendix D.
Marginal Taxable Income.--See Appendix D.
Regular Tax Computation.--Depending on marital status and size of taxable income, the taxpayer used one of the four tax rate schedules or used an approximation from the tax table to determine tax. Returns of taxpayers who had taxes computed by the Internal Revenue Service were classified under the regular tax computation method.
Schedule D Tax Computation.--Schedule D was used to compute the 10-percent, 20-percent, 25-percent, and 28-percent tax on net long-term capital gains (in excess of net short-term capital losses), if such a computation was beneficial to the taxpayer. Any investment interest allocated to long-term capital gains (on Form 4952) was excluded from this computation.
Taxable Income.--Taxable income is AGI less the sum of personal exemptions amounts and either the standard deduction for non-itemizers or total itemized deductions. The amounts for personal exemptions and total itemized deductions are net of any reductions because of taxpayers' income exceeding certain income thresholds.
Taxable Returns.--A return is classified as "taxable" based on the presence of "total income tax." The following additional taxes were not taken into account for this purpose: self-employment, household employment, Social Security, Railroad Retirement Tax Act (RRTA) taxes, tax from recomputing prior-year investment or low-income housing credits, penalty taxes on Individual Retirement Arrangements, section 72 penalty taxes, advance earned income credit payments, or "golden parachute" payments (made to key employees as compensation under certain circumstances).
Tax Generated--This is the amount of tax computed on modified taxable income either from the tax rate schedules or the tax table. Tax generated does not take into account the alternative minimum tax or the effect of tax credits. For most returns (those without the special tax on lump-sum distributions from qualified retirement plans or alternative minimum tax), tax generated equals "income tax before credits."
Total Income Tax.--Total income tax is the sum of income tax after credits and tax on accumulated trusts distribution from Form 4970, less the portion of the EIC used to offset other taxes as well as the refundable portion of the EIC.
Appendix B: Income Tax Structure
Each year, taxpayers must file an income tax return if they meet certain minimum filing requirements. The filing requirements for 2000 were generally based on the amount of "gross income," filing status, age, and, to a lesser extent, dependency and blindness [B1]. Generally, the minimum level of income for which a return was required to be filed equaled the sum of the standard deduction for the particular filing status and the amount of the personal exemption deduction allowed for the taxpayer or taxpayers (but not for any dependents). In addition to the general filing requirements, individuals were required to file a return for Tax Year 2000 if they had net earnings from self-employment of at least $400; liability for Social Security or Medicare tax on unreported tip income; Social Security, Medicare, or Railroad Retirement tax on reported tip income or group-term life insurance; "alternative minimum tax"; tax on qualified retirement plan distributions, including an Individual Retirement Arrangement (IRA) or a Medical Savings Account (MSA); tax on the recapture of investment credit or low-income housing credit; recapture tax on the disposition of a home purchased with a Federally-subsidized mortgage; any advance earned income credit payments; or wages of $108.28 or more from a church or qualified church controlled organization that was exempt from Social Security taxes.
Gross income includes all income received as money, goods, property, or services that was not expressly exempt from tax [B2]. Adjusted gross income (AGI) is equal to gross income less deductions for certain expenses [B3]. "Taxable income," the base on which income tax before credits is computed, equals AGI less the amount for personal exemptions and less either total allowable itemized deductions for taxpayers who itemize deductions, or the standard deduction (including the additional amounts for age and blindness) for all other taxpayers.
Income tax before credits is calculated from taxable income using: The tax table or tax rate schedules, both of which vary with taxpayer filing status (single, married filing jointly, surviving spouse, married filing separately, and head of household); Form 8615 or Form 8814 for children's investment income; Schedule D worksheet for net long-term capital gains; or some combination of the above [B4]. For 2000, the tax rates for each filing status were 10, 15, 20, 25, 28, 31, 36, and 39.6 percent. The tax rates of 10, 20, and 25 percent were only for net long-term capital gains (in excess of net short-term capital losses). New for 2000, income tax before credits includes any alternative minimum tax. (See Appendix C for further details on these rates.)
To calculate their Federal income tax liability for 2000, taxpayers used either the tax table or the tax rate schedules. Taxpayers with taxable income less than $100,000 were required to use the tax table, while those with taxable income of $100,000 or more were required to use the tax rate schedules. The tax table was based on income tax "brackets" up to $50 wide [BS]. The tax within each bracket was based on the tax calculated at the midpoint of the bracket and then rounded to the nearest whole dollar. As a result, the tax table and the tax rate schedules could produce different amounts of tax for the same amount of taxable income. Use of the tax table could have produced either a slightly higher or lower amount of tax than that produced by the tax rate schedules. For taxpayers using the tax table with taxable income that was subject to the 36-percent marginal rate, the maximum difference in tax between the tax rate schedules and the tax table was $9 [B6]. However, the actual difference in tax was smaller for most taxpayers.
Notes to Appendix B
[B1] Taxpayers fall into one of five filing statuses: single; married filing jointly; married filing separately; head of household; or surviving spouse. Being age 65 or older or being legally blind affects the amount of the standard deduction and, hence, the filing requirements. Those taxpayers who are (or could be) dependents of other taxpayers have different filing requirements. For more information on the general filing requirements, see Campbell and Parisi, "Individual Income Tax Returns, 2000," Statistics of Income Bulletin, Fall 2002, Volume 22, Number 2 or Publication 17, Your Federal Income Tax.
[B2] As defined under section 61 of the Internal Revenue Code, gross income includes amounts from wages and salaries, interest and dividends, alimony, bartering income, canceled debt income, gambling winnings, rents and royalties, and gains from property sales or exchanges, as well as gross profits from sole proprietorships and farming, income from partnerships and S corporations, and distributions from estates and trusts. This definition of gross income is slightly different from the Form 1040, U.S. Individual Income Tax Return, concept of "total income," which is a component of the adjusted gross income (AGI) calculation on Form 1040. Total income includes net amounts rather than gross amounts (income prior to deductions) from such items as business income and rents and royalties.
[B3] As defined under Internal Revenue Code section 62, deductible expenses are those incurred in the course of a trade or business or in connection with rents and royalties; losses from property sales or exchanges; and certain statutory adjustments, such as deductible contributions to an IRA or Keogh plan, moving expenses, or the health insurance deduction for certain self-employed taxpayers.
[B4] Income tax before credits includes tax on lump-sum distributions from qualified retirement plans.
[B5] For taxable income between $0 and $5 and between $5 and $25, the tax brackets were $5 and $10 wide, respectively. For taxable income between $25 and $3,000, the brackets were $25 wide. All brackets for taxable income above $3,000 were $50 wide.
[B6] For example, assume a taxpayer filing as "married filing separately" reported taxable income of $85,000. Using the tax table, the tax would be $22,115, but, using the tax rate schedules, the tax would be $22,124, a difference of $9.
Appendix C: Changes in Law for 2000
Alternative Minimum Tax.--For Tax Year 2000, The Tax Relief Extension Act of 1999 allowed individuals to apply personal nonrefundable credits in their full amounts against both their regular tax and alternative minimum tax. The AMT was included in income tax before credits.
Earned Income Credit.--The maximum amount of the earned income credit increased, as did the amounts of earned income and investment income an individual could have and still claim the credit. The maximum amount of investment income (interest, dividends and capital gain income) a taxpayer could have and still claim the credit increased to $2,400 from $2,350. The maximum credit for taxpayers with no qualifying children increased to $353. For these taxpayers, earned income and modified AGI had to be less than $10,380 (up from $10,200 for 1999). The maximum credit increased to $3,888 for taxpayers with one qualifying child, and to $2,353 for taxpayers with two or more qualifying children. To be eligible for the credit, a taxpayer's earned income and modified AGI had to be less than $27,413 for taxpayers with one qualifying child, or $31,152 for taxpayers with two or more qualifying children.
Exemption Amount.--Most taxpayers were allowed to claim a $2,800 deduction for each exemption to which he or she was entitled for 2000, a $50 increase over the amount allowed for 1999. The AGI threshold for the reduction of exemption amounts was also increased due to inflation, from $126,600 to $128,950 for single filers; $189,950 to $193,400 for married persons filing jointly and surviving spouses; $158,300 to $161,150 for heads of household; and $94,975 to $96,700 for married persons filing separately.
Foreign Earned Income Exclusion.--For Tax Year 2000, the amount of foreign earned income that could have been excluded from income per taxpayer increased from $74,000 to $76,000.
Itemized Deductions.--If a taxpayer's AGI was greater than $128,950 ($64,475 if married filing separately), some types of his or her itemized deductions were limited; this threshold increased from $126,600 ($63,300) for 1999 as a result of indexing for inflation. The limitation did not apply to deductions for medical and dental expenses, investment interest expenses, casualty or theft losses, and gambling losses; all other deductions were subject to the limitation. To arrive at allowable itemized deductions, total itemized deductions were reduced by the smaller of: (1) 80 percent of the "limited" deductions or (2) 3 percent of AGI in excess of the limitation threshold.
Standard Deduction.--The basic standard deduction and additional standard deduction for age or blindness increased for 2000 as a result of inflation indexing. For single filers, the basic standard deduction rose from $4,300 to $4,400; for married persons filing jointly or surviving spouses, from $7,200 to $7,350; for married persons filing separately, from $3,600 to $3,675; and for heads of household, from $6,350 to $6,450. The amount of the standard deduction for dependents was the larger of $700 or the dependents' earned income plus $250 (but not more than the regular standard deduction amount). The additional standard deduction for age and/or blindness went from $1,050 to $1,100 for single or head of household returns, but remained unchanged at $850 for married taxpayers.
Interest on Student Loans.--For Tax Year 2000, eligible taxpayers were allowed to deduct up to $2,000 of interest paid on qualified higher educational loans, up from $1,500 for 1999. These loans must have gone towards qualified expenses of either the taxpayer, taxpayer's spouse, or any dependent of the taxpayer at the time the debt was incurred. The taxpayer's modified AGI must have been less than: $55,000 if single, head of household, or qualifying widow(er); or $75,000 if married filing jointly.
Tax Brackets.--The boundaries for the tax brackets were widened to offset the effects of inflation. The 15-percent bracket applied to taxable income equal to or below $26,250 ($25,750 for 1999) for single filers; $43,850 ($43,050 for 1999) for joint filers or surviving spouses; $21,925 ($21,525 for 1999) for married persons filing separately; and $35,150 ($34,550 for 1999) for heads of household. The 28-percent tax bracket applied to taxable income in excess of the 15-percent bracket ceiling and equal to or below $63,550 ($62,450 for 1999) for single filers; $105,950 ($104,050 for 1999) for joint filers or surviving spouses; $52,975 ($52,025 for 1999) for married persons filing separately; and $90,800 ($89,150 for 1999) for heads of household. The 31-percent tax bracket applied to taxable income in excess of the 28-percent bracket ceiling and equal to or below $132,600 ($130,250 for 1999) for single filers; $161,450 ($158,550 for 1999) for joint filers or surviving spouses; $80,725 ($79,275 for 1999) for married persons filing separately; and $147,050 ($144,400 for 1999) for heads of households. The 36-percent tax bracket applied to taxable income in excess of the 31-percent bracket ceiling and equal to or below $288,350 ($283,150 for 1999) for single filers, joint filers or surviving spouses, and heads of households and $144,175 ($141,575 for 1999) for married persons filing separately. The 39.6-percent tax rate applied to taxable income in excess of the upper boundary for the 36-percent tax bracket.
Appendix D: Income and Tax Concepts
As discussed in Appendix B, gross income is all income received that is not specifically excluded. Total income is the net amount of gross income after certain expenses (i.e., business or rent and royalty expenses) have been deducted. Adjusted gross income (AGI) is the result of total income less statutory adjustments to income (i.e., deductible contributions to an IRA or Keogh plan).
1979 Income Concept
To analyze changes in income and taxes over a period of years, a consistent definition of income should be used. Because the components of AGI may vary from year to year as the law changes, the "1979 Income Concept" was developed to provide a more uniform measure of income across tax years. By including the same income and deduction items in each year's income calculation and using only items available on Federal individual income tax returns, the definition of the 1979 Income Concept is consistent throughout the base years and can be used for future years to compare income by including only income components common to all years. Tax Years 1979 through 1986 were used as base years in identifying the income and deduction items included in this concept. The 1979 Income Concept applied to 2000 includes many income and deduction items that are also components of AGI (Figure K). However, unlike AGI, the 1979 Income Concept also includes some nontaxable (i.e., tax-exempt) amounts of income reported on individual income tax returns and disallowed passive loss deductions. In addition, only straight-line deductions for depreciation are included in the 1979 Income Concept [D1].
Modified Taxable Income
This concept is relevant only for "prior-year returns." For current-year returns, modified taxable income is identical to taxable income.
This is the term used for the statistics to describe "income subject to tax," the actual base on which tax is computed. Each year, a small number of returns for prior tax years are filed during the same calendar year in which the tax returns for the current tax year are being selected for the Statistics of Income sample. Some of these returns are selected for the sample and act as proxies for returns for the current tax year that will be filed during a later calendar year. The tax on these returns is based on a previous year's tax law (which may reflect different tax rates and income concepts). For the statistics in this article, the taxable income reported on these prior-year returns is modified to equal an amount necessary to generate the tax actually shown on these returns using current-year rates.
Marginal Tax Rates
Under the progressive U.S. income tax rate structure, different portions of taxable income are taxed at different rates. Figure L illustrates how income tax is determined for a single taxpayer with AGI of $310,000 who used the standard deduction. As shown in the example, five different tax rates were applied to the taxable income to arrive at total tax. The first $26,250 of taxable income were taxed at the 15-percent rate; the next $37,300 were taxed at the 28-percent rate; the next $69,050 were taxed at the 31-percent rate; the next $155,750 were taxed at the 36-percent rate; and the remaining $17,250 were taxed at the 39.6-percent rate. For purposes of this article, the tax rate applied to the last dollar of income (given certain assumptions about which source of income provided the last dollar of income subject to tax) is the marginal tax rate for that return. In the example, the marginal tax rate is 39.6 percent.
Since the individual income tax structure includes various types of income, deductions, exclusions, credits, and taxes which are not subject to the same treatment under tax laws, the marginal tax rate is not always apparent. For instance, investment income of a dependent under age 14 in excess of a specific amount is treated differently than salaries and wages of the same dependent. The investment income in excess of $1,400 was taxed at the marginal tax rate of the parents, whereas the salaries and wages were taxed at the dependent's own rate.
Calculating marginal tax rates for a specific individual income tax return generally depends both on the types and amounts of income reported and the assumptions made about the order in which the income is taxed, in particular, which type of income is assumed to be received "last." Additional complexity is added by the presence of such items as the alternative minimum tax and various tax credits.
For this article, it is assumed that the income taxed at the marginal rate was the "last" income received. The alternative minimum tax and income tax credits, such as the earned income credit, are excluded in determining the marginal tax rates. The marginal tax rate is defined as follows:
(1) If a return showed taxable income, the marginal tax rate of the return was the highest rate at which any amount of taxable income reported on the return was taxed.
(2) If the return had no taxable income except for net long-term capital gains and that amount was less than or equal to the 15-percent tax bracket limit, the return was defined as having a "10-percent rate" marginal tax rate. If the return had taxable income (from other than net long-term capital gains) to which only the 15-percent tax rate applied, as well as net long-term capital gains to which the 20-percent or 25-percent rate on the net gain applied, the return was defined as having a marginal tax rate equal to the maximum rate at which the net gains were taxed. If the return had taxable income (from other than net long-term capital gains) to which the 28-percent tax rate applied as the highest rate, as well as net long-term capital gains to which the maximum 28-percent rate on net gain applied, the return was defined as having a "28-percent (capital gains)" marginal tax rate. However, if the return had taxable income (from other than net long-term capital gains) above the maximum amount to which the 28-percent applied, as well as net long-term capital gains to which the 28-percent rate on the net gain applied, the return was classified as having the highest rate at which any amount of taxable income reported on the return was taxed.
(3) For returns of dependents with a Form 8615 attached when the use of this form resulted in the taxation of some of the dependent's income as if it were that of the parents, the return was classified as having a "Form 8615" marginal tax rate (the returns in the Form 8615 classification are not distributed by tax rate).
(4) For returns of parents choosing to report interest and dividend income of their dependents under age 14 on their own (i.e., the parents') return using Form 8814, when the dependent's income generated the only tax liability on the parent' s return, the return was classified with a "Form 8814" marginal tax rate.
The classification of returns into marginal tax rate categories for Statistics of Income purposes was essentially a function of filing status, size of taxable income, presence of net long-term capital gains (in excess of net short-term capital losses), and presence of Form 8615 or Form 8814. Returns were classified into one of the following eleven mutually exclusive marginal tax rate categories: (1) 10-percent rate; (2) Form 8814 (15-percent rate with no tax liability other than that generated by the dependent's income); (3) 15-percent rate; (4) 20-percent rate; (5) 25-percent rate; (6) 28-percent rate with net long-term capital gains [D2]; (7)28-percent rate; (8) 31-percent rate; (9) 36-percent rate; (10) 39.6-percent rate; and (11) Form 8615 (with income taxed at any rate) [D3].
Table 1 presents statistics by marginal tax rate classification and filing status for returns with modified taxable income. For each marginal rate classification, modified taxable income and "income tax generated" were computed "at all rates" and" at marginal rate." The "at all rates" computations (columns 3 and 5) show the total amount of modified taxable income or tax generated, tabulated by the marginal tax rate specified; each tax rate classification is mutually exclusive. The "at marginal rate" computations (columns 4 and 6) report the specific amounts of modified taxable income taxed and the tax generated at the marginal tax rate shown, for all returns in each of the marginal rate classifications. For example, consider returns in the "joint returns and returns of surviving spouses" filing status that were included in the "39.6-percent" marginal tax rate classification. The total modified taxable income for the 780,834 returns in this classification "at all rates" was $802.0 billion (column 3), and the total tax generated was $263.8 billion (column 5). Approximately $410.4 billion (column 4) of the modified taxable income were subject to tax at the marginal tax rate of 39.6 percent. This modified taxable income generated $162.5 billion (column 6) in tax at the 39.6-percent tax rate with the remainder generated at the lower seven tax rates. The alternative minimum tax was not included in the statistics by marginal tax rate.
Table 2 provides statistics on the tax generated, in total and at each marginal tax rate bracket, for returns with modified taxable income. Returns in this table are classified by size of AGI rather than by the marginal tax rate classifications used in Table 1. The tax generated at each marginal tax rate was computed, based on the modified taxable income for each individual return. For example, the approximately 2.1 million returns included in the "$200,000 under $500,000" income-size classification showed total modified taxable income of $522.0 billion and generated total tax of $144.6 billion. Of the $522.0 billion of modified taxable income, $1.5 billion were taxed at 10 percent; $86.6 billion were taxed at 15 percent; $66.6 billion were taxed at 20 percent; $2.3 billion were taxed at 25 percent, $0.1 billion were taxed at the 28-percent rate with net long-term capital gains, $118.0 billion were taxed at the 28-percent rate (ordinary income); $104.2 billion were taxed at the 31 percent, $117.5 billion were taxed at 36 percent; and $24.9 billion were taxed at 39.6 percent, with the remainder consisting of income related to Forms 8814 and 8615. Approximately $0.1 billion of the total tax generated were from the 1 O-percent rate; $13.0 billion of the total tax generated were from the 15-percent rate; $13.3 billion were from the 20-percent rate; $0.6 billion were from the 25-percent rate; $0.02 billion were from the 28-percent rate with net long-term capital gains; $33.0 billion were from the 28-percent rate (ordinary income); $32.3 billion were from the 31-percent rate; $42.3 billion were from the 36-percent rate; and $9.9 billion were generated at the 39.6-percent rate, with the remainder from tax related to Forms 8814 and 8615.
Table 3 presents statistics on the income and tax generated at each marginal tax rate (as in Table 2, columns 5 through 37) by filing status, instead of size of AGI, for returns with modified taxable income. Almost 0.8 million of the more than 45.0 million returns with modified taxable income filed jointly had some income taxed at the 39.6-percent tax rate. For these returns, the taxable income subject to this rate was $410.4 billion, and the tax generated was $162.5 billion.
Notes to Appendix D
[D1] For more details on the income computation under the 1979 Income Concept for 2000, see Campbell and Parisi, "Individual Income Tax Returns, 2000," Statistics of Income Bulletin, fall 2002, Volume 22, Number 2.
[D2] The "28-percent (capital gains)" marginal tax rate category consists of returns that have a top tax rate of 28 percent, but have net long-term capital gains (in excess of net short-term capital losses), which would have been taxed at a higher rate if they had been some other form of income.
[D3] For some taxpayers, the statutory marginal tax rate may differ from the effective marginal tax rate. For example, extra income received by certain taxpayers may result in the phaseout of their personal exemptions, as well as some of their itemized deductions. Therefore, an extra $1 of income could add more than $1 of taxable income. While this taxpayer could face a statutory marginal tax rate of 31 percent, the effective marginal rate faced by the taxpayer would be somewhat higher.
Appendix E: Computation of Alternative Minimum Taxable Income (AMTI)
AMTI was computed by adding certain "tax preferences" (i.e., deduction or exclusion amounts identified as potential sources of tax savings disallowed for AMT purposes) and "adjustments" (i.e., regular tax deduction amounts recomputed or excluded for AMT purposes) to taxable income before any deductions were taken for personal exemptions (Figures M-1 and M-2). Although itemized deductions for some taxpayers were limited for regular tax purposes, the full amounts of such itemized deductions were included as adjustments. (To compensate for this, the overall limitation on itemized deductions was then subtracted from taxable income for AMT purposes.) The "net operating loss deduction" was recomputed to allow for the exclusion of the "tax preference items" and" adjustments" used to reduce regular tax liability. The recomputed net operating loss deduction, termed the "alternative net operating loss deduction," was limited to 90 percent of AMTI (with certain minor exceptions for 2000).
AMTI was reduced by an exemption amount dependent on the filing status of the individual and subject to phaseout at higher AMTI levels. The AMTI exemption for single filers (and heads of households) was $33,750; for joint filers and surviving spouses, $45,000; and for married persons filing separately, $22,500. The exemption was reduced (but not below zero) by 25 percent of the amount by which the AMTI exceeded threshold levels of $112,500 for single filers (and heads of households), $150,000 for joint filers, and $75,000 for married persons filing separately. The exemption was phased out completely for individuals whose filing status was single (or head of household), married filing jointly, and married filing separately, at $247,500, $330,000, and $165,000, of AMTI, respectively.
After reduction by the exemption, the first $175,000 ($87,500 if married filing separately) of the remaining AMTI were subject to tax at a 26-percent rate, with any excess taxed at a 28-percent rate. However, capital gains (recalculated for AMT purposes) that were taxed at lower rates (10, 20, and 25 percent) were tax at these same rates for the AMT, with the rest of AMTI being taxed at the rates mentioned above (26 percent or 28 percent). The resulting tax was reduced by the "alternative minimum tax foreign tax credit," which produced a "tentative minimum tax." Tentative minimum tax was further reduced by the individual's regular tax before credits (excluding tax on lump-sum distributions from qualified retirement plans) less the foreign tax credit (for regular tax purposes) to yield the alternative minimum tax.
Dependents under the age of 14 with investment income over a certain amount who filed their own returns were subject to special rules for AMT purposes. These rules required that the dependents pay the same amount of AMT as their parents would have paid if the parents included the dependents' incomes on their own tax returns. (Dependents filing their own returns were limited to an AMT exemption of $5,200 plus their "earned income." The dependent's AMT could be reduced if the parents had regular tax greater than the child's own tentative minimum tax, or if any other dependent under age 14 of the same parents had regular tax greater than this dependent's own tentative minimum tax.)
Appendix F: Data Sources and Limitations
These statistics are based on a sample of individual income tax returns (Forms 1040, 1040A, 1040EZ, and 1040PC, including electronically-filed returns) filed during Calendar Year 2001. They also include some returns that were filed during the beginning of Calendar Year 2002 for Tax Year 2000 due to a special extension granted to taxpayers who were affected by the terrorist attacks of September 11, 2001. Returns in the sample were stratified, based on: (1) the larger of positive income or negative income; (2) the size of business and farm receipts; (3) the presence or absence of specific forms or schedules; and (4) the usefulness of returns for tax policy modeling purposes [F1]. Returns were then selected at rates ranging from 0.05 percent to 100 percent. The 2000 data are based on a sample of 196,156 returns and an estimated final population of 129,644,987 returns. The corresponding sample and population returns for 1999 were 176,966 and 127,321,626, respectively.
Since the data presented here are estimates based on a sample of returns filed, they are subject to sampling error. To properly use the statistical data provided, the magnitude of the potential sampling error must be known; coefficients of variation (CV's) are used to measure that magnitude. Figure N shows estimated CV's for the numbers of returns and money amounts for selected income items. The reliability of estimates based on samples, and the use of coefficients of variation for evaluating the precision of estimates based on samples, are discussed in the appendix to this issue of the Bulletin.
Notes to Appendix F
[F1] Returns in the sample were stratified, based on the presence or absence of one or more of the following forms or schedules: Form 2555, Foreign Earned Income; Form 1116, Foreign Tax Credit (Individual, Fiduciary, or Nonresident Alien Individual); Schedule C, Profit or Loss from Business (Sole Proprietorship); and Schedule F, Profit or Loss from Farming.
Table 1.--Returns with Modified Taxable Income: Tax Classified by
Marginal Tax Rate, Tax Year 2000
(All figures are estimates based on samples--money amounts are in
thousands of dollars)
Adjusted
Highest marginal rate Number of gross
at which tax was computed returns income
(less deficit)
(1) (2)
All returns
Total 105,254,144 6,255,479,877
10 percent 1,239,906 16,073,905
15 percent (Form 8814) (1) 22,171 -5,793
15 percent 68,277,153 1,895,800,696
20 percent 1,396,709 209,925,287
25 percent 45,524 8,556,124
28 percent (capital gains) (2) 67,436 6,579,824
28 percent 27,243,957 2,060,878,797
31 percent 3,924,396 576,327,152
36 percent 1,569,935 428,868,704
39.6 percent 921,356 1,047,120,135
Form 8615 (3) 545,600 5,355,047
Joint returns and returns
of surviving spouses
Total 45,034,053 4,222,346,268
10 percent 249,042 7,834,768
15 percent (Form 8814) (1) ** **
15 percent 24,339,522 1,009,793,406
20 percent 763,883 147,277,143
25 percent 33,065 6,685,102
28 percent (capital gains) (2) ** **
28 percent 15,418,387 1,437,769,406
31 percent 2,186,116 384,715,030
36 percent 1,201,529 341,378,919
39.6 percent 780,834 882,089,865
Form 8615 (3) -- --
Returns of married
persons filing separately
Total 2,222,887 112,217,984
10 percent 10,502 234,093
15 percent (Form 8814) (1) ** **
15 percent 1,253,060 25,937,731
20 percent 14,126 4,552,245
25 percent 1,182 231,045
28 percent (capital gains) (2) ** **
28 percent 744,741 33,705,330
31 percent 131,500 11,113,760
36 percent 40,680 5,904,480
39.6 percent 27,088 30,533,754
Form 8615 (3) -- --
Returns of heads
of households
Total 12,421,206 419,598,692
10 percent 21,171 611,144
15 percent (Form 8814) (1) * 6,676 * 78,505
15 percent 10,886,454 286,764,434
20 percent 63,396 6,758,325
25 percent * 560 * 152,586
28 percent (capital gains) (2) -- --
28 percent 1,318,375 88,874,281
31 percent 72,268 10,905,732
36 percent 36,607 8,966,282
39.6 percent 15,699 16,487,405
Form 8615 (3) -- --
Returns of single persons
Total 45,575,998 1,501,316,933
10 percent 959,191 7,393,900
15 percent (Form 8814) (1) -- --
15 percent 31,798,117 573,305,125
20 percent 555,304 51,337,574
25 percent 10,718 1,487,392
28 percent (capital gains) (2) 21,249 1,687,351
28 percent 9,762,454 500,529,780
31 percent 1,534,511 169,592,630
36 percent 291,119 72,619,023
39.6 percent 97,735 118,009,111
Form 8615 (3) 545,600 5,355,047
Modified taxable income
Highest marginal rate Taxed at Taxed at
at which tax was computed all rates marginal
rate
(3) (4)
All returns
Total 4,544,454,724 2,102,758,318
10 percent 5,526,181 5,525,082
15 percent (Form 8814) (1) 25,701 25,701
15 percent 1,015,294,204 997,113,758
20 percent 163,406,083 112,559,841
25 percent 7,177,733 1,568,072
28 percent (capital gains) (2) 5,131,252 307,623
28 percent 1,549,300,652 335,962,198
31 percent 471,862,727 81,876,009
36 percent 369,823,904 73,980,668
39.6 percent 951,976,119 489,420,352
Form 8615 (3) 4,930,169 4,419,014
Joint returns and returns
of surviving spouses
Total 3,134,788,665 1,354,243,588
10 percent 2,459,722 2,459,393
15 percent (Form 8814) (1) ** **
15 percent 539,829,943 529,998,830
20 percent 114,454,382 80,779,303
25 percent 5,580,333 1,230,286
28 percent (capital gains) (2) ** **
28 percent 1,063,601,346 225,387,739
31 percent 310,417,271 47,391,519
36 percent 292,660,259 56,474,756
39.6 percent 802,026,869 410,363,116
Form 8615 (3) -- --
Returns of married
persons filing separately
Total 84,597,060 41,423,381
10 percent 62,085 61,968
15 percent (Form 8814) (1) ** **
15 percent 14,285,802 14,167,041
20 percent 3,472,388 3,146,622
25 percent 189,775 86,015
28 percent (capital gains) (2) ** **
28 percent 25,121,386 6,675,671
31 percent 9,047,326 1,452,650
36 percent 5,114,458 1,038,055
39.6 percent 27,294,178 14,795,318
Form 8615 (3) -- --
Returns of heads
of households
Total 232,841,988 157,770,260
10 percent 262,248 262,248
15 percent (Form 8814) (1) * 7,379 * 7,379
15 percent 130,678,484 129,665,571
20 percent 5,324,537 3,096,158
25 percent * 133,212 * 27,226
28 percent (capital gains) (2) -- --
28 percent 64,859,489 13,590,857
31 percent 8,903,594 1,654,823
36 percent 7,753,458 1,503,681
39.6 percent 14,919,586 7,962,316
Form 8615 (3) -- --
Returns of single persons
Total 1,092,227,012 549,321,089
10 percent 2,742,125 2,741,474
15 percent (Form 8814) (1) -- --
15 percent 330,499,975 323,282,316
20 percent 40,144,776 25,537,758
25 percent 1,274,413 224,544
28 percent (capital gains) (2) 1,391,371 167,258
28 percent 395,718,431 90,307,931
31 percent 143,494,536 31,377,017
36 percent 64,295,729 14,964,176
39.6 percent 107,735,486 56,299,601
Form 8615 (3) 4,930,169 4,419,014
Tax generated
Highest marginal rate At
at which tax was computed At all rates marginal
rate
(5) (6)
All returns
Total 1,008,640,394 514,103,193
10 percent 552,754 552,508
15 percent (Form 8814) (1) 3,855 3,855
15 percent 151,410,696 149,567,064
20 percent 29,337,306 22,511,968
25 percent 1,425,500 392,018
28 percent (capital gains) (2) 1,039,695 86,134
28 percent 297,985,907 94,069,415
31 percent 112,453,232 25,381,563
36 percent 99,754,259 26,633,040
39.6 percent 313,510,924 193,810,459
Form 8615 (3) 1,166,267 1,095,169
Joint returns and returns
of surviving spouses
Total 724,081,523 356,885,880
10 percent 246,008 245,939
15 percent (Form 8814) (1) ** **
15 percent 80,503,973 79,499,825
20 percent 20,723,975 16,155,861
25 percent 1,105,390 307,572
28 percent (capital gains) (2) ** **
28 percent 205,272,347 63,108,567
31 percent 73,415,182 14,691,371
36 percent 78,299,222 20,330,912
39.6 percent 263,764,749 162,503,794
Form 8615 (3) -- --
Returns of married
persons filing separately
Total 19,980,020 11,334,247
10 percent 6,214 6,197
15 percent (Form 8814) (1) ** **
15 percent 2,136,989 2,125,056
20 percent 672,663 629,324
25 percent 40,961 21,504
28 percent (capital gains) (2) ** 9
28 percent 4,834,442 1,869,188
31 percent 2,152,749 450,322
36 percent 1,369,837 373,700
39.6 percent 8,764,230 5,858,946
Form 8615 (3) -- --
Returns of heads
of households
Total 41,833,501 28,116,044
10 percent 26,224 26,225
15 percent (Form 8814) (1) * 1,107 * 1,107
15 percent 19,554,008 19,449,836
20 percent 917,501 619,232
25 percent * 27,024 * 6,807
28 percent (capital gains) (2) -- --
28 percent 11,991,756 3,805,440
31 percent 2,158,312 512,995
36 percent 2,116,755 541,325
39.6 percent 5,040,814 3,153,077
Form 8615 (3) -- --
Returns of single persons
Total 222,745,350 117,767,024
10 percent 274,309 274,147
15 percent (Form 8814) (1) -- --
15 percent 49,215,726 48,492,347
20 percent 7,023,167 5,107,552
25 percent 252,125 56,136
28 percent (capital gains) (2) 289,830 46,832
28 percent 75,887,361 25,286,221
31 percent 34,726,989 9,726,875
36 percent 17,968,445 5,387,103
39.6 percent 35,941,132 22,294,642
Form 8615 (3) 1,166,267 1,095,169
Income tax after credits
As a percentage of--
Highest marginal rate Adjusted Modified
at which tax was computed Total gross taxable
income income
(less deficit)
(7) (8) (9)
All returns
Total 979,416,711 15.7 21.6
10 percent 513,415 3.2 9.3
15 percent (Form 8814) (1) 15,737 (X) 61.2
15 percent 129,924,012 6.9 12.8
20 percent 30,236,001 14.4 18.5
25 percent 1,451,686 17.0 20.2
28 percent (capital gains) (2) 1,034,590 15.7 20.2
28 percent 291,538,275 14.1 18.8
31 percent 113,202,803 19.6 24.0
36 percent 100,178,224 23.4 27.1
39.6 percent 310,190,563 29.6 32.6
Form 8615 (3) 1,131,405 21.1 22.9
Joint returns and returns
of surviving spouses
Total 704,795,790 16.7 22.5
10 percent 232,047 3.0 9.4
15 percent (Form 8814) (1) ** ** **
15 percent 67,981,795 6.7 12.6
20 percent 21,350,511 14.5 18.7
25 percent 1,123,626 16.8 20.1
28 percent (capital gains) (2) ** ** **
28 percent 199,471,734 13.9 18.8
31 percent 73,938,682 19.2 23.8
36 percent 78,597,888 23.0 26.9
39.6 percent 261,351,449 29.6 32.6
Form 8615 (3) -- (X) (X)
Returns of married
persons filing separately
Total 19,522,511 17.4 23.1
10 percent 5,058 2.2 8.1
15 percent (Form 8814) (1) ** ** **
15 percent 1,956,710 7.5 13.7
20 percent 717,567 15.8 20.7
25 percent 43,959 19.0 23.2
28 percent (capital gains) (2) ** ** **
28 percent 4,760,343 14.1 18.9
31 percent 2,162,154 19.5 23.9
36 percent 1,374,832 23.3 26.9
39.6 percent 8,499,924 27.8 31.1
Form 8615 (3) -- (X) (X)
Returns of heads
of households
Total 34,305,354 8.2 14.7
10 percent 20,875 3.4 8.0
15 percent (Form 8814) (1) * 306 * 0.4 * 4.1
15 percent 12,479,049 4.4 9.5
20 percent 920,440 13.6 17.3
25 percent * 29,281 * 19.2 * 22
28 percent (capital gains) (2) -- (X) (X)
28 percent 11,613,958 13.1 17.9
31 percent 2,186,667 20.1 24.6
36 percent 2,120,426 23.6 27.3
39.6 percent 4,934,351 29.9 33.1
Form 8615 (3) -- (X) (X)
Returns of single persons
Total 220,793,057 14.7 20.2
10 percent 255,435 3.5 * 9.3
15 percent (Form 8814) (1) -- (X) (X)
15 percent 47,506,459 8.3 14.4
20 percent 7,247,483 14.1 18.1
25 percent 254,820 17.1 20.0
28 percent (capital gains) (2) 299,998 17.8 21.6
28 percent 75,692,240 15.1 19.1
31 percent 34,915,300 20.6 24.3
36 percent 18,085,079 24.9 28.1
39.6 percent 35,404,839 30.0 32.9
Form 8615 (3) 1,131,405 21.1 22.9
* Estimate should be used with caution due to the small number of
sample returns on which it is based.
** Data deleted to avoid disclosure of information for specific
taxpayers. Deleted data are included in appropriate totals.
(1) Form 8814 was filed for a dependent child under age 14 for whom the
parents made the election to report the child's investment income (if
it was from interest or dividends totaling between $700 and $7,000) on
the parents' income tax return. This rate classification is comprised
of those returns with a tax liability only from the dependents' income.
(2) Returns with net long-term capital gains in excess of short-term
capital losses taxed at the 28-percent rate, which otherwise (based on
ordinary income) would be taxed at a higher rate than 28 percent.
(3) Form 8615 was filed for a child under age 14 to report the child's
investment income in excess of $1,400. The returns in this rate
classification are not distributed by tax rate.
(X) Percentage not computed
NOTE: Detail may not add to totals because of rounding.
Table 2.--Returns with Modified Taxable Income: Tax Generated
by Rate and by Size of Adjusted Gross Income, Tax Year 2000
[All figures are estimates based on samples--money amounts
are in thousands of dollars]
Number
Size of of Taxable
adjusted gross income returns income
(1) (2)
Total 105,254,144 4,544,242,347
Under $2,000 (2) 728,355 403,500
$2,000 under $4,000 772,689 1,164,830
$4,000 under $6,000 1,770,153 2,271,887
$6,000 under $8,000 2,168,907 4,372,394
$8,000 under $10,000 2,975,905 7,419,540
$10,000 under $12,000 2,920,227 11,477,791
$12,000 under $14,000 3,396,633 16,198,328
$14,000 under $16,000 3,977,962 22,398,362
$16,000 under $18,000 4,192,127 28,494,359
$18,000 under $20,000 4,287,569 35,484,903
$20,000 under $25,000 9,585,445 108,031,449
$25,000 under $30,000 8,235,563 127,600,390
$30,000 under $40,000 13,410,399 289,468,391
$40,000 under $50,000 10,376,331 305,175,955
$50,000 under $75,000 17,026,414 724,730,198
$75,000 under $100,000 8,585,345 537,645,034
$100,000 under $200,000 8,076,677 821,705,724
$200,000 under $500,000 2,132,745 521,942,794
$500,000 under $1,000,000 395,413 239,349,218
$1,000,000 under $1,500,000 99,333 108,725,941
$1,500,000 under $2,000,000 44,504 69,595,617
$2,000,000 under $5,000,000 66,651 181,760,398
$5,000,000 under $10,000,000 17,576 109,905,445
$10,000,000 or more 11,201 268,919,902
Modified Tax
taxable generated
Size of income at all rates
adjusted gross income
(3) (4)
4,544,454,724 1,008,640,394
Total
407,564 53,222
Under $2,000 (2) 1,179,015 175,650
$2,000 under $4,000 2,272,602 345,189
$4,000 under $6,000 4,394,476 660,409
$6,000 under $8,000 7,422,399 1,114,373
$8,000 under $10,000 11,477,900 1,701,847
$10,000 under $12,000 16,201,206 2,419,538
$12,000 under $14,000
22,401,665 3,341,833
$14,000 under $16,000 28,497,321 4,249,634
$16,000 under $18,000 35,527,215 5,293,477
$18,000 under $20,000 108,030,830 16,109,360
$20,000 under $25,000 127,608,814 19,946,013
$25,000 under $30,000 289,490,599 44,307,242
$30,000 under $40,000 305,222,306 49,596,589
$40,000 under $50,000
724,735,063 123,389,614
$50,000 under $75,000 537,652,653 103,922,256
$75,000 under $100,000 821,745,446 185,016,291
$100,000 under $200,000 521,950,125 144,638,780
$200,000 under $500,000 239,364,402 75,682,396
$500,000 under $1,000,000
108,721,787 35,307,670
$1,000,000 under $1,500,000 69,593,141 22,634,618
$1,500,000 under $2,000,000 181,746,298 58,561,043
$2,000,000 under $5,000,000 108,903,190 34,570,570
$5,000,000 under $10,000,000 268,908,707 76,502,781
$10,000,000 or more
Tax generated at
specified rate
10 percent
Number Income
Size of of taxed
adjusted gross income income at rate
(5) (6)
Total 9,407,394 40,421,905
Under $2,000 (2) 495,906 223,790
$2,000 under $4,000 487,205 519,790
$4,000 under $6,000 310,026 495,566
$6,000 under $8,000 262,459 496,403
$8,000 under $10,000 289,120 515,877
$10,000 under $12,000 265,176 621,594
$12,000 under $14,000 220,331 534,888
$14,000 under $16,000 262,234 648,534
$16,000 under $18,000 300,435 703,598
$18,000 under $20,000 296,253 888,463
$20,000 under $25,000 743,700 2,400,726
$25,000 under $30,000 725,454 2,453,723
$30,000 under $40,000 1,284,217 5,267,751
$40,000 under $50,000 1,052,261 4,704,327
$50,000 under $75,000 1,771,573 9,741,786
$75,000 under $100,000 329,076 3,903,088
$100,000 under $200,000 220,585 3,851,303
$200,000 under $500,000 62,120 1,479,381
$500,000 under $1,000,000 15,148 468,135
$1,000,000 under $1,500,000 4,300 140,267
$1,500,000 under $2,000,000 2,392 83,058
$2,000,000 under $5,000,000 4,331 158,555
$5,000,000 under $10,000,000 1,606 62,394
$10,000,000 or more 1,488 58,900
Tax generated at
specified rate
15 percent
10 percent (from Form
8814) (1)
Tax Number
Size of generated of
adjusted gross income at rate returns
(7) (8)
Total 4,042,634 348,381
Under $2,000 (2) 22,417 3,320
$2,000 under $4,000 52,003 * 948
$4,000 under $6,000 49,563 * 948
$6,000 under $8,000 49,645 * 972
$8,000 under $10,000 51,610 * 2,175
$10,000 under $12,000 62,175 * 6
$12,000 under $14,000 53,510 * 2,894
$14,000 under $16,000 64,858 * 5,870
$16,000 under $18,000 70,375 * 2,851
$18,000 under $20,000 88,862 * 3,855
$20,000 under $25,000 240,108 * 3,811
$25,000 under $30,000 245,411 * 7,246
$30,000 under $40,000 526,821 12,679
$40,000 under $50,000 470,492 21,942
$50,000 under $75,000 974,250 50,681
$75,000 under $100,000 390,326 71,508
$100,000 under $200,000 385,138 94,179
$200,000 under $500,000 147,940 43,757
$500,000 under $1,000,000 46,814 11,025
$1,000,000 under $1,500,000 14,027 3,479
$1,500,000 under $2,000,000 8,306 1,261
$2,000,000 under $5,000,000 15,856 2,074
$5,000,000 under $10,000,000 6,239 500
$10,000,000 or more 5,890 399
Tax generated at
specified rate
15 percent (from
Form 8814) (1)
Income Tax
Size of taxed generated
adjusted gross income at rate at rate
(9) (10)
Total 276,017 41,412
Under $2,000 (2) 3,731 560
$2,000 under $4,000 * 2,656 * 398
$4,000 under $6,000 * 664 * 100
$6,000 under $8,000 * 2,042 * 306
$8,000 under $10,000 * 2,817 * 422
$10,000 under $12,000 * 8 * 1
$12,000 under $14,000 * 4,748 * 712
$14,000 under $16,000 * 4,506 * 676
$16,000 under $18,000 * 2,812 * 421
$18,000 under $20,000 * 1,531 * 230
$20,000 under $25,000 * 3,347 * 502
$25,000 under $30,000 * 7,332 * 1,100
$30,000 under $40,000 10,395 1,559
$40,000 under $50,000 13,571 2,040
$50,000 under $75,000 33,931 5,092
$75,000 under $100,000 39,919 5,990
$100,000 under $200,000 87,084 13,062
$200,000 under $500,000 36,915 5,538
$500,000 under $1,000,000 10,548 1,582
$1,000,000 under $1,500,000 3,430 515
$1,500,000 under $2,000,000 1,257 189
$2,000,000 under $5,000,000 1,900 285
$5,000,000 under $10,000,000 493 74
$10,000,000 or more 382 57
Tax generated at
specified rate
15 percent
Number Income
Size of of taxed
adjusted gross income returns at rate
(11) (12)
Total 103,530,686 2,272,668,608
Under $2,000 (2) 317,249 144,708
$2,000 under $4,000 489,458 402,597
$4,000 under $6,000 1,643,144 1,473,950
$6,000 under $8,000 2,089,056 3,603,201
$8,000 under $10,000 2,877,806 6,641,863
$10,000 under $12,000 2,851,067 10,724,172
$12,000 under $14,000 3,346,703 15,480,792
$14,000 under $16,000 3,917,115 21,551,786
$16,000 under $18,000 4,138,983 27,703,296
$18,000 under $20,000 4,237,913 34,509,481
$20,000 under $25,000 9,492,816 105,430,869
$25,000 under $30,000 8,180,391 124,852,531
$30,000 under $40,000 13,338,616 274,917,058
$40,000 under $50,000 10,328,037 267,926,122
$50,000 under $75,000 16,976,572 591,182,597
$75,000 under $100,000 8,551,864 344,926,537
$100,000 under $200,000 8,030,519 329,507,563
$200,000 under $500,000 2,110,201 86,586,059
$500,000 under $1,000,000 385,925 15,821,060
$1,000,000 under $1,500,000 95,984 3,928,138
$1,500,000 under $2,000,000 42,587 1,742,390
$2,000,000 under $5,000,000 62,852 2,561,089
$5,000,000 under $10,000,000 16,083 653,740
$10,000,000 or more 9,745 397,010
Tax generated at
specified rate
15 percent 20 percent
Tax Number
Size of generated of
adjusted gross income at rate returns
(13) (14)
Total 340,900,291 10,753,975
Under $2,000 (2) 21,706 --
$2,000 under $4,000 60,390 --
$4,000 under $6,000 221,093 --
$6,000 under $8,000 540,480 --
$8,000 under $10,000 996,279 --
$10,000 under $12,000 1,608,626 --
$12,000 under $14,000 2,322,119 --
$14,000 under $16,000 3,232,768 --
$16,000 under $18,000 4,155,494 --
$18,000 under $20,000 5,176,422 --
$20,000 under $25,000 15,814,630 --
$25,000 under $30,000 18,727,880 10,582
$30,000 under $40,000 41,237,559 382,093
$40,000 under $50,000 40,188,918 641,196
$50,000 under $75,000 88,677,390 2,306,784
$75,000 under $100,000 51,738,981 2,392,279
$100,000 under $200,000 49,426,134 3,334,007
$200,000 under $500,000 12,987,909 1,248,095
$500,000 under $1,000,000 2,373,159 261,412
$1,000,000 under $1,500,000 589,220 70,787
$1,500,000 under $2,000,000 261,359 32,601
$2,000,000 under $5,000,000 364,163 50,675
$5,000,000 under $10,000,000 98,061 13,994
$10,000,000 or more 59,552 9,471
Tax generated at
specified rate
20 percent
Income Tax
Size of taxed generated
adjusted gross income at rate at rate
(15) (16)
Total 493,969,412 98,793,867
Under $2,000 (2) -- --
$2,000 under $4,000 -- --
$4,000 under $6,000 -- --
$6,000 under $8,000 -- --
$8,000 under $10,000 -- --
$10,000 under $12,000 -- --
$12,000 under $14,000 -- --
$14,000 under $16,000 -- --
$16,000 under $18,000 -- --
$18,000 under $20,000 -- --
$20,000 under $25,000 -- --
$25,000 under $30,000 5,715 1,144
$30,000 under $40,000 613,258 122,651
$40,000 under $50,000 2,327,280 465,447
$50,000 under $75,000 11,492,030 2,298,388
$75,000 under $100,000 16,297,463 3,259,501
$100,000 under $200,000 52,569,839 10,513,963
$200,000 under $500,000 66,551,510 13,310,311
$500,000 under $1,000,000 45,856,808 9,171,360
$1,000,000 under $1,500,000 26,320,918 5,264,183
$1,500,000 under $2,000,000 19,074,128 3,814,826
$2,000,000 under $5,000,000 59,086,573 11,817,315
$5,000,000 under $10,000,000 43,019,565 8,603,913
$10,000,000 or more 150,754,326 30,150,865
Tax generated at
specified rate
25 percent
Number Income
Size of of taxed
adjusted gross income returns at rate
(17) (18)
Total 409,610 8,521,816
Under $2,000 (2) -- --
$2,000 under $4,000 -- --
$4,000 under $6,000 -- --
$6,000 under $8,000 -- --
$8,000 under $10,000 -- --
$10,000 under $12,000 -- --
$12,000 under $14,000 -- --
$14,000 under $16,000 -- --
$16,000 under $18,000 -- --
$18,000 under $20,000 -- --
$20,000 under $25,000 -- --
$25,000 under $30,000 -- --
$30,000 under $40,000 * 3,306 * 2,404
$40,000 under $50,000 * 6,746 * 12,296
$50,000 under $75,000 46,117 174,942
$75,000 under $100,000 73,250 307,224
$100,000 under $200,000 149,502 1,909,338
$200,000 under $500,000 85,899 2,318,350
$500,000 under $1,000,000 25,631 1,392,909
$1,000,000 under $1,500,000 6,942 489,534
$1,500,000 under $2,000,000 3,615 357,612
$2,000,000 under $5,000,000 5,660 733,158
$5,000,000 under $10,000,000 1,637 330,336
$10,000,000 or more 1,305 493,714
Tax generated at
specified rate
28 percent
(capital
25 percent gains) (3)
Tax Number
Size of generated of
adjusted gross income at rate returns
(19) (20)
Total 2,130,509 104,922
Under $2,000 (2) -- --
$2,000 under $4,000 -- --
$4,000 under $6,000 -- --
$6,000 under $8,000 -- --
$8,000 under $10,000 -- --
$10,000 under $12,000 -- --
$12,000 under $14,000 -- --
$14,000 under $16,000 -- --
$16,000 under $18,000 -- --
$18,000 under $20,000 -- --
$20,000 under $25,000 -- --
$25,000 under $30,000 -- --
$30,000 under $40,000 * 601 --
$40,000 under $50,000 * 3,075 * 4,106
$50,000 under $75,000 43,741 18,224
$75,000 under $100,000 76,817 29,127
$100,000 under $200,000 477,357 35,025
$200,000 under $500,000 579,597 12,898
$500,000 under $1,000,000 348,231 2,417
$1,000,000 under $1,500,000 122,384 975
$1,500,000 under $2,000,000 89,403 507
$2,000,000 under $5,000,000 183,290 825
$5,000,000 under $10,000,000 82,584 402
$10,000,000 or more 123,429 415
Tax generated at
specified rate
28 percent (capital
gains) (3)
Income Tax
Size of taxed generated
adjusted gross income at rate at rate
(21) (22)
Total 1,951,428 546,403
Under $2,000 (2) -- --
$2,000 under $4,000 -- --
$4,000 under $6,000 -- --
$6,000 under $8,000 -- --
$8,000 under $10,000 -- --
$10,000 under $12,000 -- --
$12,000 under $14,000 -- --
$14,000 under $16,000 -- --
$16,000 under $18,000 -- --
$18,000 under $20,000 -- --
$20,000 under $25,000 -- --
$25,000 under $30,000 -- --
$30,000 under $40,000 -- --
$40,000 under $50,000 * 10,715 * 3,001
$50,000 under $75,000 67,461 18,889
$75,000 under $100,000 42,068 11,779
$100,000 under $200,000 189,920 53,180
$200,000 under $500,000 84,464 23,650
$500,000 under $1,000,000 157,131 43,997
$1,000,000 under $1,500,000 147,151 41,202
$1,500,000 under $2,000,000 117,935 33,022
$2,000,000 under $5,000,000 401,380 112,386
$5,000,000 under $10,000,000 292,246 81,829
$10,000,000 or more 440,957 123,468
Tax generated at
specified rate
28 percent
Number Income
Size of of taxed
adjusted gross income returns at rate
(23) (24)
Total 33,728,994 816,986,775
Under $2,000 (2) -- --
$2,000 under $4,000 -- --
$4,000 under $6,000 -- --
$6,000 under $8,000 -- --
$8,000 under $10,000 -- --
$10,000 under $12,000 -- --
$12,000 under $14,000 -- --
$14,000 under $16,000 -- --
$16,000 under $18,000 -- --
$18,000 under $20,000 * 948 * 1,343
$20,000 under $25,000 * 3,014 * 318
$25,000 under $30,000 52,786 55,189
$30,000 under $40,000 2,777,734 8,408,602
$40,000 under $50,000 3,497,469 30,146,971
$50,000 under $75,000 8,963,640 111,271,913
$75,000 under $100,000 7,964,426 163,944,285
$100,000 under $200,000 7,803,232 350,400,050
$200,000 under $500,000 2,063,654 117,990,535
$500,000 under $1,000,000 376,208 21,866,020
$1,000,000 under $1,500,000 94,445 5,439,205
$1,500,000 under $2,000,000 41,854 2,419,893
$2,000,000 under $5,000,000 62,046 3,569,923
$5,000,000 under $10,000,000 15,897 915,967
$10,000,000 or more 9,642 556,561
Tax generated at
specified rate
28 percent 31 percent
Tax Number
Size of generated of
adjusted gross income at rate returns
(25) (26)
Total 228,756,297 6,415,727
Under $2,000 (2) -- --
$2,000 under $4,000 -- --
$4,000 under $6,000 -- --
$6,000 under $8,000 -- --
$8,000 under $10,000 -- --
$10,000 under $12,000 -- --
$12,000 under $14,000 -- --
$14,000 under $16,000 -- --
$16,000 under $18,000 -- --
$18,000 under $20,000 * 376 --
$20,000 under $25,000 * 89 --
$25,000 under $30,000 15,453 --
$30,000 under $40,000 2,354,409 --
$40,000 under $50,000 8,441,152 --
$50,000 under $75,000 31,156,136 138,899
$75,000 under $100,000 45,904,400 776,385
$100,000 under $200,000 98,112,014 2,972,810
$200,000 under $500,000 33,037,350 1,943,310
$500,000 under $1,000,000 6,122,486 365,641
$1,000,000 under $1,500,000 1,522,977 91,660
$1,500,000 under $2,000,000 677,570 40,868
$2,000,000 under $5,000,000 999,578 60,844
$5,000,000 under $10,000,000 256,471 15,736
$10,000,000 or more 155,837 9,575
Tax generated at
specified rate
31 percent
Income Tax
Size of taxed generated
adjusted gross income at rate at rate
(27) (28)
Total 223,573,114 69,307,665
Under $2,000 (2) -- --
$2,000 under $4,000 -- --
$4,000 under $6,000 -- --
$6,000 under $8,000 -- --
$8,000 under $10,000 -- --
$10,000 under $12,000 -- --
$12,000 under $14,000 -- --
$14,000 under $16,000 -- --
$16,000 under $18,000 -- --
$18,000 under $20,000 -- --
$20,000 under $25,000 -- --
$25,000 under $30,000 -- --
$30,000 under $40,000 -- --
$40,000 under $50,000 -- --
$50,000 under $75,000 491,861 152,477
$75,000 under $100,000 8,088,873 2,507,551
$100,000 under $200,000 78,243,582 24,255,510
$200,000 under $500,000 104,245,368 32,316,064
$500,000 under $1,000,000 20,300,456 6,293,141
$1,000,000 under $1,500,000 5,107,435 1,583,305
$1,500,000 under $2,000,000 2,277,210 705,935
$2,000,000 under $5,000,000 3,403,585 1,055,111
$5,000,000 under $10,000,000 881,384 273,229
$10,000,000 or more 533,360 165,342
Tax generated at
specified rate
36 percent
Number Income
Size of of taxed
adjusted gross income returns at rate
(29) (30)
Total 2,491,332 192,234,038
Under $2,000 (2) -- --
$2,000 under $4,000 -- --
$4,000 under $6,000 -- --
$6,000 under $8,000 -- --
$8,000 under $10,000 -- --
$10,000 under $12,000 -- --
$12,000 under $14,000 -- --
$14,000 under $16,000 -- --
$16,000 under $18,000 -- --
$18,000 under $20,000 -- --
$20,000 under $25,000 -- --
$25,000 under $30,000 -- --
$30,000 under $40,000 -- --
$40,000 under $50,000 -- --
$50,000 under $75,000 -- --
$75,000 under $100,000 * 5,119 * 10,199
$100,000 under $200,000 272,307 4,653,272
$200,000 under $500,000 1,651,429 117,527,494
$500,000 under $1,000,000 349,945 43,422,096
$1,000,000 under $1,500,000 88,666 11,059,178
$1,500,000 under $2,000,000 39,689 4,976,846
$2,000,000 under $5,000,000 59,219 7,436,438
$5,000,000 under $10,000,000 15,477 1,950,950
$10,000,000 or more 9,480 1,197,564
Tax generated at
specified rate
36 percent 39.6 percent
Tax Number
Size of generated of
adjusted gross income at rate returns
(31) (32)
Total 69,204,254 921,396
Under $2,000 (2) -- --
$2,000 under $4,000 -- --
$4,000 under $6,000 -- --
$6,000 under $8,000 -- --
$8,000 under $10,000 -- --
$10,000 under $12,000 -- --
$12,000 under $14,000 -- --
$14,000 under $16,000 -- --
$16,000 under $18,000 -- --
$18,000 under $20,000 -- --
$20,000 under $25,000 -- --
$25,000 under $30,000 -- --
$30,000 under $40,000 -- --
$40,000 under $50,000 -- --
$50,000 under $75,000 -- --
$75,000 under $100,000 * 3,672 --
$100,000 under $200,000 1,675,178 4,679
$200,000 under $500,000 42,309,898 396,962
$500,000 under $1,000,000 15,631,955 319,895
$1,000,000 under $1,500,000 3,981,304 82,674
$1,500,000 under $2,000,000 1,791,665 37,300
$2,000,000 under $5,000,000 2,677,118 55,848
$5,000,000 under $10,000,000 702,342 14,806
$10,000,000 or more 431,123 9,232
Tax generated at
specified rate
39.6 percent
Income Tax
Size of taxed generated
adjusted gross income at rate at rate
(33) (34)
Total 489,432,594 193,815,307
Under $2,000 (2) -- --
$2,000 under $4,000 -- --
$4,000 under $6,000 -- --
$6,000 under $8,000 -- --
$8,000 under $10,000 -- --
$10,000 under $12,000 -- --
$12,000 under $14,000 -- --
$14,000 under $16,000 -- --
$16,000 under $18,000 -- --
$18,000 under $20,000 -- --
$20,000 under $25,000 -- --
$25,000 under $30,000 -- --
$30,000 under $40,000 -- --
$40,000 under $50,000 -- --
$50,000 under $75,000 -- --
$75,000 under $100,000 -- --
$100,000 under $200,000 75,378 29,850
$200,000 under $500,000 24,923,176 9,869,578
$500,000 under $1,000,000 89,858,525 35,583,976
$1,000,000 under $1,500,000 55,947,581 22,155,242
$1,500,000 under $2,000,000 38,465,304 15,232,260
$2,000,000 under $5,000,000 104,219,312 41,270,848
$5,000,000 under $10,000,000 61,706,343 24,435,712
$10,000,000 or more 114,236,974 45,237,842
Tax generated at
specified rate
Form 8615 (4)
Number Income
Size of of taxed
adjusted gross income returns at rate
(35) (36)
Total 545,600 4,419,014
Under $2,000 (2) 98,141 35,335
$2,000 under $4,000 169,980 253,969
$4,000 under $6,000 87,406 302,423
$6,000 under $8,000 56,276 292,831
$8,000 under $10,000 36,754 261,843
$10,000 under $12,000 13,781 132,126
$12,000 under $14,000 15,293 180,777
$14,000 under $16,000 14,544 196,839
$16,000 under $18,000 * 5,809 * 87,615
$18,000 under $20,000 * 7,653 * 126,396
$20,000 under $25,000 9,517 195,570
$25,000 under $30,000 * 9,602 * 234,324
$30,000 under $40,000 * 8,501 * 271,131
$40,000 under $50,000 * 1,850 * 81,024
$50,000 under $75,000 * 5,485 * 278,542
$75,000 under $100,000 * 1,341 * 92,988
$100,000 under $200,000 * 2,330 * 258,115
$200,000 under $500,000 * 722 * 206,873
$500,000 under $1,000,000 * 358 * 210,713
$1,000,000 under $1,500,000 122 138,952
$1,500,000 under $2,000,000 * 49 * 77,509
$2,000,000 under $5,000,000 64 174,386
$5,000,000 under $10,000,000 * 13 * 89,775
$10,000,000 or more * 9 * 238,958
Tax generated at
specified rate
Form 8615 (4)
Tax
Size of generated
adjusted gross income at rate
(37)
Total 1,095,169
Under $2,000 (2) 8,484
$2,000 under $4,000 62,775
$4,000 under $6,000 74,364
$6,000 under $8,000 69,919
$8,000 under $10,000 65,968
$10,000 under $12,000 30,938
$12,000 under $14,000 43,087
$14,000 under $16,000 43,416
$16,000 under $18,000 * 23,185
$18,000 under $20,000 * 27,507
$20,000 under $25,000 53,882
$25,000 under $30,000 * 54,916
$30,000 under $40,000 * 63,391
$40,000 under $50,000 * 22,023
$50,000 under $75,000 * 61,692
$75,000 under $100,000 * 21,957
$100,000 under $200,000 * 73,198
$200,000 under $500,000 * 50,819
$500,000 under $1,000,000 * 85,678
$1,000,000 under $1,500,000 33,306
$1,500,000 under $2,000,000 * 20,082
$2,000,000 under $5,000,000 45,090
$5,000,000 under $10,000,000 * 30,116
$10,000,000 or more * 49,376
* Estimate should be used with caution because of the small
number of sample returns on which it is based.
(1) Form 8814 was filed for a dependent child under age 14
for whom the parents made the election to report the child's
investment income (if it was from interest or dividends totaling
between $700 and $7,000) on the parents' income tax return.
This rate classification is comprised of those returns with a tax
liability only from the dependents' income.
(2) Includes returns with adjusted gross deficit.
(3) Returns with net long-term capital gains in excess of short-term
capital losses taxed at the 28 percent rate, which otherwise (based
on ordinary income) would be taxed at a higher rate than 28 percent.
(4) Form 8615 was filed for a child under age 14 to report the child's
investment income in excess of $1,400. The returns in this rate
classification are not distributed by tax rate.
NOTE: Detail may not add to totals because of rounding.
Table 3.--Returns with Modified Taxable Income: Taxable Income, and Tax
Classified by Marginal Tax Rate and by Filing Status, Tax Year 2000
[All figures are estimates based on samples--money
amounts are in thousands of dollars]
All
returns
Marginal tax
rate classes Number Income Income tax
of taxed generated
returns at rate at rate
(1) (2) (3)
All tax rates 105,254,144 4,544,454,721 1,008,633,322
10 percent 9,407,394 40,421,905 4,042,191
15 percent
(Form 8814) (1) 348,381 276,017 41,412
15 percent 103,530,686 2,272,668,608 340,900,291
20 percent 10,753,975 493,969,412 98,793,882
25 percent 409,610 8,521,816 2,130,454
28 percent
(capital gains) (2) 104,922 1,951,428 546,400
28 percent 33,728,994 816,986,775 228,756,297
31 percent 6,415,727 223,573,114 69,307,665
36 percent 2,491,332 192,234,038 69,204,254
39.6 percent 921,396 489,432,594 193,815,307
Form 8615 (3) 545,600 4,419,014 1,095,169
Joint returns and
returns of surviving spouses
Marginal tax
rate classes Number Income Income tax
of taxed generated
returns at rate at rate
(4) (5) (6)
All tax rates 45,034,053 3,134,788,664 724,077,757
10 percent 4,162,759 22,297,615 2,229,762
15 percent
(Form 8814) (1) 305,543 248,795 37,328
15 percent 44,699,014 1,415,664,794 212,349,719
20 percent 7,064,845 376,788,720 75,357,744
25 percent 288,846 6,905,034 1,726,259
28 percent
(capital gains) (2) 74,780 1,436,165 402,126
28 percent 19,633,052 588,109,185 164,670,572
31 percent 4,168,479 157,412,666 48,797,926
36 percent 1,982,363 155,562,574 56,002,527
39.6 percent 780,834 410,363,116 162,503,794
Form 8615 (3) -- -- --
Returns of married
persons filing separately
Marginal tax
rate classes Number Income Income tax
of taxed generated
returns at rate at rate
(7) (8) (9)
All tax rates 2,222,887 84,597,060 19,979,927
10 percent 72,162 333,273 33,327
15 percent
(Form 8814) (1) 4,147 1,630 244
15 percent 2,208,448 35,047,522 5,257,128
20 percent 156,730 14,005,709 2,801,142
25 percent 4,298 240,276 60,069
28 percent
(capital gains) (2) 262 96,007 26,882
28 percent 944,010 13,987,333 3,916,453
31 percent 199,269 3,333,217 1,033,297
36 percent 67,768 2,756,775 992,439
39.6 percent 27,088 14,795,318 5,858,946
Form 8615 (3) -- -- --
Returns of heads
of households
Marginal tax
rate classes Number Income Income tax
of taxed generated
returns at rate at rate
(10) (11) (12)
All tax rates 12,421,206 232,841,987 41,833,044
10 percent 458,314 1,966,137 196,614
15 percent
(Form 8814) (1) 36,335 23,982 3,599
15 percent 12,389,708 181,913,095 27,286,964
20 percent 281,163 8,901,886 1,780,377
25 percent 6,179 137,587 34,397
28 percent
(capital gains) (2) 68 13,285 3,720
28 percent 1,442,949 23,604,812 6,609,347
31 percent 124,573 4,596,995 1,425,068
36 percent 52,305 3,721,892 1,339,881
39.6 percent 15,699 7,962,316 3,153,077
Form 8615 (3) -- -- --
Returns of
single persons
Marginal tax
rate classes Number Income Income tax
of taxed generated
returns at rate at rate
(13) (14) (15)
All tax rates 45,575,998 1,092,227,006 222,742,594
10 percent 4,714,159 15,824,879 1,582,488
15 percent
(Form 8814) (1) 2,355 1,610 242
15 percent 44,233,515 640,043,196 96,006,479
20 percent 3,251,237 94,273,096 18,854,619
25 percent 110,287 1,238,919 309,730
28 percent
(capital gains) (2) 29,812 405,971 113,672
28 percent 11,708,983 191,285,445 53,559,925
31 percent 1,923,407 58,230,236 18,051,373
36 percent 388,895 30,192,797 10,869,407
39.6 percent 97,776 56,311,843 22,299,490
Form 8615 (3) 545,600 4,419,014 1,095,169
(1) Form 8814 was filed for a dependent child under age 14 for whom the
parents made an election to report the child's investment income (if it
was from interest or dividends totaling between $700 and $7,000) on the
parents' income tax return. This rate classification is comprised of
those returns with a tax liability only from the dependents' income.
(2) Returns with net long-term capital gains in excess of short-term
capital losses taxed at the 28-percent rate, which otherwise (based
on ordinary income) would be taxed at a higher rate than 28 percent.
(3) Form 8615 was filed for a child under age 14 to report the
child's investment income in excess of $1,400. The returns in
this rate classification are not distributed by tax rate.
NOTE: Detail may not add to totals because of rounding.
Table 4.--Returns with Modified Taxable Income: Tax Classified
by Type of Tax Computation and by Size of Adjusted Gross Income,
Tax Years 1999 and 2000
[All figures are estimates based on samples--money
amounts are in thousands of dollars]
Tax Year 1999
Income tax before credits
Type of tax computation (regular tax computation) (1)
by size of
adjusted gross income Number of
returns Amount
(1) (2)
Returns with regular tax
computation only
Total 84,117,372 487,596,499
Under $5,000 (3) 1,240,612 106,742
$5,000 under $10,000 5,552,709 1,656,010
$10,000 under $15,000 7,822,748 5,337,754
$15,000 under $20,000 9,850,125 10,644,024
$20,000 under $25,000 8,860,009 15,121,307
$25,000 under $30,000 7,494,517 17,673,473
$30,000 under $40,000 11,676,541 38,785,497
$40,000 under $50,000 8,306,213 39,813,102
$50,000 under $75,000 13,231,473 94,799,981
$75,000 under $100,000 5,346,995 64,925,546
$100,000 under $200,000 3,873,863 86,621,811
$200,000 under $500,000 715,331 50,548,866
$500,000 under $1,000,000 100,671 21,075,754
$1,000,000 or more 45,567 40,486,630
Returns with Form 8615
tax computation
Total 574,924 783,166
Under $5,000 (3) 392,164 116,615
$5,000 under $10,000 103,215 94,475
$10,000 under $15,000 33,092 52,355
$15,000 under $20,000 17,248 42,355
$20,000 under $25,000 * 8,483 * 26,577
$25,000 under $30,000 * 5,615 * 20,779
$30,000 under $40,000 * 7,095 * 40,738
$40,000 under $50,000 * 3,611 * 31,586
$50,000 under $75,000 * 903 * 9,749
$75,000 under $100,000 * 495 * 4,292
$100,000 under $200,000 * 2,035 * 54,816
$200,000 under $500,000 * 502 * 41,165
$500,000 under $1,000,000 * 166 * 28,509
$1,000,000 or more 300 219,155
Returns with Schedule D
tax computation
Total 16,913,104 464,675,975
Under $5,000 (3) 344,434 81,189
$5,000 under $10,000 377,758 200,723
$10,000 under $15,000 515,435 459,634
$15,000 under $20,000 673,885 809,946
$20,000 under $25,000 720,274 1,254,687
$25,000 under $30,000 722,133 1,765,560
$30,000 under $40,000 1,464,062 5,134,958
$40,000 under $50,000 1,495,997 7,718,621
$50,000 under $75,000 3,451,142 27,359,947
$75,000 under $100,000 2,435,436 31,956,485
$100,000 under $200,000 3,186,404 80,518,771
$200,000 under $500,000 1,136,894 86,629,285
$500,000 under $1,000,000 239,726 51,736,522
$1,000,000 or more 149,523 169,049,647
Tax Year 1999
Type of tax computation Tax Difference
by size of Generated due to
adjusted gross income special tax
Amount computation (2)
(3) (4)
Returns with regular tax
computation only
Total 487,448,545 --
Under $5,000 (3) 106,742 --
$5,000 under $10,000 1,656,012 --
$10,000 under $15,000 5,337,754 --
$15,000 under $20,000 10,644,021 --
$20,000 under $25,000 15,120,404 --
$25,000 under $30,000 17,673,437 --
$30,000 under $40,000 38,785,119 --
$40,000 under $50,000 39,812,766 --
$50,000 under $75,000 94,790,013 --
$75,000 under $100,000 64,899,761 --
$100,000 under $200,000 86,589,360 --
$200,000 under $500,000 50,535,030 --
$500,000 under $1,000,000 21,066,494 --
$1,000,000 or more 40,431,632 --
Returns with Form 8615
tax computation
Total 933,335 150,170
Under $5,000 (3) 145,473 28,858
$5,000 under $10,000 134,238 39,763
$10,000 under $15,000 79,883 27,529
$15,000 under $20,000 61,326 18,971
$20,000 under $25,000 * 45,395 * 18,818
$25,000 under $30,000 * 37,405 * 16,626
$30,000 under $40,000 * 60,300 * 19,563
$40,000 under $50,000 * 52,604 * 21,018
$50,000 under $75,000 * 17,926 * 8,177
$75,000 under $100,000 * 5,337 * 1,046
$100,000 under $200,000 * 65,614 * 10,798
$200,000 under $500,000 * 39,861 * -1,304
$500,000 under $1,000,000 * 20,480 * -8,030
$1,000,000 or more 167,492 -51,662
Returns with Schedule D
tax computation
Total 405,764,485 -58,911,490
Under $5,000 (3) 64,329 -16,861
$5,000 under $10,000 166,815 -33,908
$10,000 under $15,000 412,948 -46,686
$15,000 under $20,000 739,611 -70,334
$20,000 under $25,000 1,167,990 -86,697
$25,000 under $30,000 1,669,335 -96,225
$30,000 under $40,000 4,872,644 -262,314
$40,000 under $50,000 7,369,755 -348,866
$50,000 under $75,000 26,148,320 -1,211,627
$75,000 under $100,000 30,439,377 -1,517,108
$100,000 under $200,000 75,868,192 -4,650,580
$200,000 under $500,000 78,165,542 -8,463,743
$500,000 under $1,000,000 45,111,759 -6,624,763
$1,000,000 or more 133,567,869 -35,481,778
Tax Year 2000
Income tax before credits
Type of tax computation (regular tax computation) (1)
by size of
adjusted gross income Number of
returns Amount
(5) (6)
Returns with regular tax
computation only
Total 86,253,365 551,085,194
Under $5,000 (3) 1,078,606 95,867
$5,000 under $10,000 5,376,121 1,572,648
$10,000 under $15,000 7,575,796 5,221,615
$15,000 under $20,000 9,835,992 10,481,502
$20,000 under $25,000 8,836,069 14,929,470
$25,000 under $30,000 7,503,322 17,441,990
$30,000 under $40,000 11,885,936 39,381,033
$40,000 under $50,000 8,838,458 42,319,879
$50,000 under $75,000 13,469,310 96,554,724
$75,000 under $100,000 6,080,232 72,951,937
$100,000 under $200,000 4,703,933 105,422,834
$200,000 under $500,000 877,224 61,161,992
$500,000 under $1,000,000 131,522 27,443,320
$1,000,000 or more 60,643 56,106,383
Returns with Form 8615
tax computation
Total 545,600 1,037,678
Under $5,000 (3) 315,664 97,763
$5,000 under $10,000 132,892 122,066
$10,000 under $15,000 36,860 65,912
$15,000 under $20,000 20,219 48,411
$20,000 under $25,000 9,517 30,035
$25,000 under $30,000 * 9,602 * 36,409
$30,000 under $40,000 * 8,501 * 47,765
$40,000 under $50,000 * 1,850 * 16,747
$50,000 under $75,000 * 5,485 * 59,777
$75,000 under $100,000 * 1,341 * 22,214
$100,000 under $200,000 * 2,330 * 68,628
$200,000 under $500,000 * 722 * 67,214
$500,000 under $1,000,000 * 358 * 75,510
$1,000,000 or more 257 279,226
Returns with Schedule D
tax computation
Total 17,091,388 512,907,932
Under $5,000 (3) 352,329 90,427
$5,000 under $10,000 453,538 253,821
$10,000 under $15,000 454,214 396,705
$15,000 under $20,000 606,573 742,182
$20,000 under $25,000 653,902 1,149,155
$25,000 under $30,000 673,190 1,599,616
$30,000 under $40,000 1,451,698 5,017,390
$40,000 under $50,000 1,488,654 7,531,647
$50,000 under $75,000 3,506,337 27,987,392
$75,000 under $100,000 2,471,632 32,263,622
$100,000 under $200,000 3,325,589 84,065,248
$200,000 under $500,000 1,232,936 92,326,984
$500,000 under $1,000,000 254,211 55,040,976
$1,000,000 or more 166,585 204,442,766
Tax Year 2000
Type of tax computation Tax Difference
by size of Generated due to
adjusted gross income special tax
Amount computation (2)
(7) (8)
Returns with regular tax
computation only
Total 550,958,257 --
Under $5,000 (3) 95,867 --
$5,000 under $10,000 1,572,648 --
$10,000 under $15,000 5,221,108 --
$15,000 under $20,000 10,481,502 --
$20,000 under $25,000 14,928,791 --
$25,000 under $30,000 17,441,823 --
$30,000 under $40,000 39,380,171 --
$40,000 under $50,000 42,314,453 --
$50,000 under $75,000 96,536,715 --
$75,000 under $100,000 72,929,417 --
$100,000 under $200,000 105,393,439 --
$200,000 under $500,000 61,139,844 --
$500,000 under $1,000,000 27,433,567 --
$1,000,000 or more 56,088,913 --
Returns with Form 8615
tax computation
Total 1,138,311 100,633
Under $5,000 (3) 130,992 33,229
$5,000 under $10,000 187,459 65,392
$10,000 under $15,000 100,217 34,305
$15,000 under $20,000 72,102 23,691
$20,000 under $25,000 54,409 24,374
$25,000 under $30,000 * 55,511 * 19,102
$30,000 under $40,000 * 63,699 * 15,935
$40,000 under $50,000 * 22,133 * 5,385
$50,000 under $75,000 * 61,873 * 2,096
$75,000 under $100,000 * 22,027 * -187
$100,000 under $200,000 * 73,398 * 4,770
$200,000 under $500,000 * 50,822 * -16,392
$500,000 under $1,000,000 * 65,694 * -9,815
$1,000,000 or more 177,975 -101,252
Returns with Schedule D
tax computation
Total 440,309,912 -72,598,019
Under $5,000 (3) 71,582 -18,846
$5,000 under $10,000 208,746 -45,075
$10,000 under $15,000 346,607 -50,098
$15,000 under $20,000 675,322 -66,860
$20,000 under $25,000 1,061,668 -87,487
$25,000 under $30,000 1,500,569 -99,047
$30,000 under $40,000 4,758,088 -259,302
$40,000 under $50,000 7,156,434 -375,213
$50,000 under $75,000 26,643,396 -1,343,996
$75,000 under $100,000 30,774,256 -1,489,366
$100,000 under $200,000 78,973,737 -5,091,511
$200,000 under $500,000 82,606,393 -9,720,591
$500,000 under $1,000,000 47,198,832 -7,842,145
$1,000,000 or more 158,334,283 -46,108,483
* Estimate should be used with caution due to the
small number of sample returns on which it is based.
(1) Includes special tax not included in tax generated.
(2) The difference between the amount of tax resulting
from using provisions of one of the special tax computations
and the amount of tax resulting from the regular tax computation.
(3) Includes returns with adjusted gross deficit.
NOTE: Detail may not add to totals because of rounding.
Table 5.--Returns with Positive Adjusted Gross Income (AGI):
Number of Returns, Shares of AGI and Total Income Tax, AGI Floor on
Percentiles in Current and Constant Dollars, and Average Tax Rates,
by Selected Descending Cumulative Percentiles of Returns Based on
Income Size Using the Definition of AGI for Each Year, Tax Years
1986-2000
[All figures are estimates based on samples]
Descending cumulative
percentiles
Item, tax year Total Top Top
1 percent 5 percent
(1) (2) (3)
Number of returns: (1)
1986 102,087,623 1,020,876 5,104,381
1987 106,154,761 1,061,548 5,307,738
1988 108,872,859 1,088,729 5,443,643
1989 111,312,721 1,113,127 5,565,636
1990 112,812,262 1,128,123 5,640,613
1991 113,804,104 1,138,041 5,690,205
1992 112,652,759 1,126,528 5,632,638
1993 113,681,387 1,136,814 5,684,069
1994 114,989,920 1,149,899 5,749,496
1995 117,274,186 1,172,742 5,863,709
1996 119,441,767 1,194,418 5,972,088
1997 121,503,284 1,215,033 6,075,164
1998 123,775,831 1,237,758 6,188,792
1999 126,008,974 1,260,090 6,300,449
2000 128,227,143 1,282,271 6,411,357
Adjusted gross Income
floor on percentiles
(current dollars):
1986 N/A 118,818 62,377
1987 N/A 139,289 68,414
1988 N/A 157,136 72,735
1989 N/A 163,869 76,933
1990 N/A 167,421 79,064
1991 N/A 170,139 81,720
1992 N/A 181,904 85,103
1993 N/A 185,715 87,386
1994 N/A 195,726 91,226
1995 N/A 209,406 96,221
1996 N/A 227,546 101,141
1997 N/A 250,736 108,048
1998 N/A 269,496 114,729
1999 N/A 293,415 120,846
2000 N/A 313,469 128,336
Adjusted gross income
floor on percentiles
(constant dollars):
1986 N/A 108,411 56,913
1987 N/A 122,614 60,224
1988 N/A 132,828 61,484
1989 N/A 132,152 62,043
1990 N/A 128,096 60,493
1991 N/A 124,919 60,000
1992 N/A 129,654 60,658
1993 N/A 128,522 60,475
1994 N/A 132,069 61,556
1995 N/A 137,406 63,137
1996 N/A 145,026 64,462
1997 N/A 156,222 67,320
1998 N/A 164,427 69,999
1999 N/A 176,119 72,537
2000 N/A 182,038 74,527
Adjusted gross
income (millions
of dollars):
1986 2,524,124 285,197 608,467
1987 2,813,728 346,635 722,221
1988 3,124,156 473,527 890,702
1989 3,298,858 468,079 918,421
1990 3,451,237 483,252 953,337
1991 3,516,142 456,603 943,350
1992 3,680,552 523,586 1,031,093
1993 3,775,578 520,586 1,048,252
1994 3,961,146 546,700 1,103,084
1995 4,244,607 619,610 1,222,723
1996 4,590,527 736,545 1,393,805
1997 5,023,457 872,826 1,597,107
1998 5,469,211 1,010,245 1,796,647
1999 5,909,329 1,152,820 2,011,763
2000 6,423,977 1,336,773 2,267,403
Total income tax
(millions of
dollars): (2)
1986 366,979 94,491 156,240
1987 369,046 91,559 159,642
1988 412,761 113,841 188,303
1989 432,838 109,259 190,188
1990 447,061 112,338 195,088
1991 448,349 111,267 194,480
1992 476,163 131,156 218,479
1993 502,720 145,836 238,083
1994 534,754 154,337 254,106
1995 588,331 178,035 287,741
1996 658,124 212,626 335,433
1997 727,303 241,239 377,241
1998 788,452 274,009 424,506
1999 877,292 317,419 486,464
2000 980,521 366,929 553,670
Average tax rate
(percentage): (3)
1986 14.54 33.13 25.68
1987 13.12 26.41 22.10
1988 13.21 24.04 21.14
1989 13.12 23.34 20.71
1990 12.95 23.25 20.46
1991 12.75 24.37 20.62
1992 12.94 25.05 21.19
1993 13.32 28.01 22.71
1994 13.50 28.23 23.04
1995 13.86 28.73 23.53
1996 14.34 28.87 24.07
1997 14.48 27.64 23.62
1998 14.42 27.12 23.63
1999 14.85 27.53 24.18
2000 15.26 27.45 24.42
Adjusted gross Income
share (percentage):
1986 100.00 11.30 24.11
1987 100.00 12.32 25.67
1988 100.00 15.16 28.51
1989 100.00 14.19 27.84
1990 100.00 14.00 27.62
1991 100.00 12.99 26.83
1992 100.00 14.23 28.01
1993 100.00 13.79 27.76
1994 100.00 13.80 27.85
1995 100.00 14.60 28.81
1996 100.00 16.04 30.36
1997 100.00 17.38 31.79
1998 100.00 18.47 32.85
1999 100.00 19.51 34.04
2000 100.00 20.81 35.30
Total Income tax
share (percentage):
1986 100.00 25.75 42.57
1987 100.00 24.81 43.26
1988 100.00 27.58 45.62
1989 100.00 25.24 43.94
1990 100.00 25.13 43.64
1991 100.00 24.82 43.38
1992 100.00 27.54 45.88
1993 100.00 29.01 47.36
1994 100.00 28.86 47.52
1995 100.00 30.26 48.91
1996 100.00 32.31 50.97
1997 100.00 33.17 51.87
1998 100.00 34.75 53.84
1999 100.00 36.18 55.45
2000 100.00 37.42 56.47
Descending cumulative percentiles
Item, tax year Top Top Top
10 percent 25 percent 50 percent
(4) (5) (6)
Number of returns: (1)
1986 10,208,762 25,521,906 51,043,811
1987 10,615,476 26,538,690 53,077,380
1988 10,887,286 27,218,214 54,436,429
1989 11,131,272 27,828,181 55,656,361
1990 11,281,226 28,203,066 56,406,132
1991 11,380,410 28,451,026 56,902,052
1992 11,265,276 28,163,190 56,326,380
1993 11,368,139 28,420,347 56,840,694
1994 11,498,992 28,747,480 57,494,960
1995 11,727,419 29,318,546 58,637,093
1996 11,944,177 29,860,442 59,720,884
1997 12,150,328 30,375,821 60,751,642
1998 12,377,583 30,943,958 61,887,915
1999 12,600,897 31,502,244 63,004,487
2000 12,822,714 32,056,786 64,113,572
Adjusted gross Income
floor on percentiles
(current dollars):
1986 48,656 32,242 17,302
1987 52,921 33,983 17,768
1988 55,437 35,398 18,367
1989 58,263 36,839 18,993
1990 60,287 38,080 19,767
1991 61,944 38,929 20,097
1992 64,457 40,378 20,803
1993 66,077 41,210 21,179
1994 68,753 42,742 21,802
1995 72,094 44,207 22,344
1996 74,986 45,757 23,174
1997 79,212 48,173 24,393
1998 83,220 50,607 25,491
1999 87,682 52,965 26,415
2000 92,144 55,225 27,682
Adjusted gross income
floor on percentiles
(constant dollars):
1986 44,394 29,418 15,786
1987 46,585 29,915 15,641
1988 46,861 29,922 15,526
1989 46,986 29,709 15,317
1990 46,126 29,135 15,124
1991 45,480 28,582 14,756
1992 45,942 28,780 14,828
1993 45,728 28,519 14,657
1994 46,392 28,841 14,711
1995 47,306 29,007 14,661
1996 47,792 29,163 14,769
1997 49,353 30,014 15,198
1998 50,775 30,877 15,553
1999 52,630 31,792 15,855
2000 53,510 32,070 16,075
Adjusted gross
income (millions
of dollars):
1986 886,510 1,490,173 2,103,569
1987 1,038,221 1,709,389 2,373,869
1988 1,232,536 1,950,860 2,657,865
1989 1,286,539 2,054,478 2,805,235
1990 1,338,032 2,144,177 2,932,537
1991 1,343,202 2,174,765 2,984,003
1992 1,443,784 2,299,401 3,131,400
1993 1,474,463 2,357,953 3,212,299
1994 1,552,205 2,481,074 3,371,352
1995 1,704,513 2,689,820 3,627,542
1996 1,909,149 2,952,637 3,944,383
1997 2,151,401 3,267,600 4,327,992
1998 2,393,716 3,589,600 4,721,430
1999 2,652,835 3,927,308 5,126,164
2000 2,955,386 4,313,786 5,589,755
Total income tax
(millions of
dollars): (2)
1986 200,703 278,976 343,289
1987 205,230 283,857 346,655
1988 236,411 321,297 389,145
1989 241,458 334,258 407,599
1990 247,514 344,340 421,075
1991 250,282 346,511 423,759
1992 276,213 373,700 452,070
1993 297,808 398,516 478,563
1994 317,902 425,402 509,256
1995 357,402 472,808 561,225
1996 411,404 535,164 629,684
1997 459,639 594,007 696,161
1998 512,836 651,964 755,240
1999 583,002 732,890 842,168
2000 660,150 823,706 942,179
Average tax rate
(percentage): (3)
1986 22.64 18.72 16.32
1987 19.77 16.61 14.60
1988 19.18 16.47 14.64
1989 18.77 16.27 14.53
1990 18.50 16.06 14.36
1991 18.63 15.93 14.20
1992 19.13 16.25 14.44
1993 20.20 16.90 14.90
1994 20.48 17.15 15.11
1995 20.97 17.58 15.47
1996 21.55 18.12 15.96
1997 21.36 18.18 16.09
1998 21.42 18.16 16.00
1999 21.98 18.66 16.43
2000 22.34 19.09 16.86
Adjusted gross Income
share (percentage):
1986 35.12 59.04 83.34
1987 36.90 60.75 84.37
1988 39.45 62.44 85.07
1989 39.00 62.28 85.04
1990 38.77 62.13 84.97
1991 38.20 61.85 84.87
1992 39.23 62.47 85.08
1993 39.05 62.45 85.08
1994 39.19 62.64 85.11
1995 40.16 63.37 85.46
1996 41.59 64.32 85.92
1997 42.83 65.05 86.16
1998 43.77 65.63 86.33
1999 44.89 66.46 86.75
2000 46.01 67.15 87.01
Total Income tax
share (percentage):
1986 54.69 76.02 93.54
1987 55.61 76.92 93.93
1988 57.28 77.84 94.28
1989 55.78 77.22 94.17
1990 55.36 77.02 94.19
1991 55.82 77.29 94.52
1992 58.01 78.48 94.94
1993 59.24 79.27 95.19
1994 59.45 79.55 95.23
1995 60.75 80.36 95.39
1996 62.51 81.32 95.68
1997 63.20 81.67 95.72
1998 65.04 82.69 95.79
1999 66.45 83.54 96.00
2000 67.33 84.01 96.09
Footnotes at end of Table 6.
Table 6.--Returns with Positive Adjusted Gross Income (AGI):
Number of Returns, Shares of AGI and Total Income Tax, and
Average Tax Rates, by Selected Ascending Cumulative Percentiles
of Returns Based on Income Size Using the Definition of AGI for
Each Year, Tax Years 1986-2000
[All figures are estimates based on samples]
Ascending
cumulative percentiles
Item, tax year Total Bottom Bottom
50 percent 75 percent
(1) (2) (3)
Number of returns: (1)
1986 102,087,623 51,043,811 76,565,717
1987 106,154,761 53,077,380 79,616,071
1988 108,872,858 54,436,429 81,654,643
1989 111,312,721 55,656,361 83,484,542
1990 112,812,262 56,406,132 84,609,198
1991 113,804,104 56,902,052 85,353,078
1992 112,652,759 56,326,380 84,489,560
1993 113,681,387 56,840,693 85,261,040
1994 114,989,920 57,494,960 86,242,440
1995 117,274,186 58,637,093 87,955,640
1996 119,441,767 59,720,883 89,581,325
1997 121,503,284 60,751,642 91,127,463
1998 123,775,831 61,887,916 92,831,873
1999 126,008,974 63,004,487 94,506,731
2000 128,227,143 64,113,572 96,170,357
Adjusted gross
Income (millions
of dollars):
1986 2,524,124 420,555 1,033,951
1987 2,813,728 439,859 1,104,338
1988 3,124,156 466,291 1,173,296
1989 3,298,858 493,623 1,244,380
1990 3,451,237 518,700 1,307,060
1991 3,516,142 532,138 1,341,377
1992 3,680,552 549,152 1,381,151
1993 3,775,578 563,279 1,417,625
1994 3,961,146 589,795 1,480,073
1995 4,244,607 617,065 1,554,788
1996 4,590,527 646,144 1,637,891
1997 5,023,457 695,465 1,755,857
1998 5,469,211 747,781 1,879,611
1999 5,909,329 783,164 1,982,021
2000 6,423,977 834,222 2,110,190
Total Income tax
(millions of
dollars): (2)
1986 366,979 23,690 88,002
1987 369,046 22,391 85,189
1988 412,761 23,616 91,464
1989 432,838 25,239 98,580
1990 447,061 25,986 102,721
1991 448,349 24,554 101,837
1992 476,163 24,093 102,463
1993 502,720 24,157 104,203
1994 534,754 25,499 109,353
1995 588,331 27,106 115,523
1996 658,124 28,440 122,960
1997 727,303 31,134 133,296
1998 788,452 33,212 136,488
1999 877,292 35,126 144,402
2000 980,521 38,343 156,816
Average tax rate
(percentage): (3)
1986 14.54 5.63 8.51
1987 13.12 5.09 7.71
1988 13.21 5.06 7.80
1989 13.12 5.11 7.92
1990 12.95 5.01 7.86
1991 12.75 4.61 7.59
1992 12.94 4.39 7.42
1993 13.32 4.29 7.35
1994 13.50 4.32 7.39
1995 13.86 4.39 7.43
1996 14.34 4.40 7.51
1997 14.48 4.48 7.59
1998 14.42 4.44 7.26
1999 14.85 4.49 7.29
2000 15.26 4.60 7.43
Adjusted gross Income
share (percentage):
1986 100.00 16.66 40.96
1987 100.00 15.63 39.25
1988 100.00 14.93 37.56
1989 100.00 14.96 37.72
1990 100.00 15.03 37.87
1991 100.00 15.13 38.15
1992 100.00 14.92 37.53
1993 100.00 14.92 37.55
1994 100.00 14.89 37.36
1995 100.00 14.54 36.63
1996 100.00 14.08 35.68
1997 100.00 13.84 34.95
1998 100.00 13.67 34.37
1999 100.00 13.25 33.54
2000 100.00 12.99 32.85
Total Income tax
share (percentage):
1986 100.00 6.46 23.98
1987 100.00 6.07 23.08
1988 100.00 5.72 22.16
1989 100.00 5.83 22.78
1990 100.00 5.81 22.98
1991 100.00 5.48 22.71
1992 100.00 5.06 21.52
1993 100.00 4.81 20.73
1994 100.00 4.77 20.45
1995 100.00 4.61 19.64
1996 100.00 4.32 18.68
1997 100.00 4.28 18.33
1998 100.00 4.21 17.31
1999 100.00 4.00 16.46
2000 100.00 3.91 15.99
Ascending cumulative percentiles
Item, tax year Bottom Bottom Bottom
90 percent 95 percent 99 percent
(4) (5) (6)
Number of returns: (1)
1986 91,878,861 96,983,242 101,066,747
1987 95,539,285 100,847,023 105,093,213
1988 97,985,572 103,429,215 107,784,129
1989 100,181,451 105,747,087 110,199,596
1990 101,531,038 107,171,651 111,684,141
1991 102,423,694 108,113,899 112,686,063
1992 101,387,483 107,020,121 111,526,231
1993 102,313,248 107,997,318 112,544,573
1994 103,490,928 109,240,424 113,840,021
1995 105,546,767 111,410,477 116,101,444
1996 107,497,590 113,469,679 118,247,349
1997 109,352,956 115,428,120 120,288,251
1998 111,398,248 117,587,039 122,538,073
1999 113,408,077 119,708,525 124,748,884
2000 115,404,429 121,815,786 126,944,872
Adjusted gross
Income (millions
of dollars):
1986 1,637,614 1,915,657 2,238,927
1987 1,775,506 2,091,507 2,467,093
1988 1,891,620 2,233,454 2,650,629
1989 2,012,319 2,380,437 2,830,779
1990 2,113,205 2,497,900 2,967,985
1991 2,172,939 2,572,792 3,059,539
1992 2,236,768 2,649,459 3,156,966
1993 2,301,115 2,727,326 3,254,992
1994 2,408,941 2,858,063 3,414,447
1995 2,540,094 3,021,884 3,624,997
1996 2,681,378 3,196,723 3,853,983
1997 2,872,056 3,426,350 4,150,631
1998 3,075,495 3,672,564 4,458,967
1999 3,256,494 3,897,565 4,756,509
2000 3,468,590 4,156,573 5,687,204
Total Income tax
(millions of
dollars): (2)
1986 166,276 210,739 272,488
1987 163,816 209,404 277,488
1988 176,350 224,459 298,920
1989 191,380 242,650 323,579
1990 199,547 251,973 334,723
1991 198,067 253,869 337,081
1992 199,950 257,683 345,007
1993 204,912 264,637 356,884
1994 216,852 280,648 380,418
1995 230,929 300,590 410,296
1996 246,720 322,691 445,498
1997 267,664 350,062 486,064
1998 275,615 363,946 514,442
1999 294,290 390,828 559,874
2000 320,371 426,851 613,592
Average tax rate
(percentage): (3)
1986 10.15 11.00 12.17
1987 9.23 10.01 11.25
1988 9.32 10.05 11.28
1989 9.51 10.19 11.43
1990 9.44 10.09 11.28
1991 9.12 9.87 11.04
1992 8.94 9.73 10.93
1993 8.90 9.70 10.96
1994 9.00 9.82 11.14
1995 9.09 9.95 11.32
1996 9.20 10.09 11.56
1997 9.32 10.22 11.71
1998 8.96 9.91 11.54
1999 9.04 10.03 11.77
2000 9.24 10.27 12.06
Adjusted gross Income
share (percentage):
1986 64.88 75.89 88.70
1987 63.10 74.33 87.68
1988 60.55 71.49 64.84
1989 61.00 72.16 85.81
1990 61.23 72.38 86.00
1991 61.80 73.17 87.01
1992 60.77 71.99 85.77
1993 60.95 72.24 86.21
1994 60.81 72.15 86.20
1995 59.84 71.19 85.40
1996 58.41 69.64 83.96
1997 57.17 68.21 82.63
1998 56.23 67.15 81.53
1999 55.11 65.96 80.49
2000 53.99 64.70 79.19
Total Income tax
share (percentage):
1986 45.31 57.43 74.25
1987 44.39 56.74 75.19
1988 42.72 54.38 72.42
1989 44.22 56.06 74.76
1990 44.64 56.36 74.87
1991 44.18 56.62 75.18
1992 41.99 54.12 72.46
1993 40.76 52.64 70.99
1994 40.55 52.48 71.14
1995 39.25 51.09 69.74
1996 37.49 49.03 67.69
1997 36.80 48.13 66.83
1998 34.96 46.16 65.25
1999 33.55 44.55 63.82
2000 32.67 43.53 62.58
N/A--Not applicable.
(1) The number of returns with negative adjusted gross income,
i.e., returns with an adjusted gross deficit, and the corresponding
amounts for adjusted gross deficit, were excluded from Tables 5 and
6. By excluding deficit returns, alternative minimum tax reported on
some of these returns was also excluded. For Tax Year 2000, there
were 5,714 returns with no adjusted gross income that reported income
tax, mostly alternative minimum tax, totaling $100.6 million.
(2) Total income tax is the sum of income tax after credits and
alternative minimum tax for Tax Year 1999 and prior years reported
on returns that showed a positive amount for adjusted gross income.
(For Tax Year 2000, alternative minimum tax is included in income
tax before credits.) Therefore, total income tax excludes alternative
minimum tax, Form 8814 tax (tax on a child's interest or dividends),
and Form 4972 tax (tax on lump-sum distributions from qualified
retirement plans) reported on some returns with a negative amount
for adjusted gross income. See also footnote 1 and Figure E.
(3) The average tax rate was computed by dividing total income
tax (see footnote 2) by (positive) adjusted gross income.
Table 7.--Returns with Positive "1979 Income Concept" Income:
Number of Returns, Shares of Income and Total Income Tax,
Income Floor on Percentiles in Current and Constant Dollars,
and Average Tax Rates, by Selected Descending Cumulative
Percentiles of Returns Based on Income Size, Tax Years
1986-2000
[All figures are estimates based on samples]
Descending
cumulative percentiles
Item, tax year Total Top Top
1 percent 5 percent
(1) (2) (3)
Number of returns: 101,988,805 1,019,888 5,099,440
1986 106,191,624 1,061,916 5,309,581
1987 108,879,154 1,088,792 5,443,958
1988 111,328,835 1,113,288 5,566,442
1989 112,717,959 1,127,180 5,635,898
1990 113,823,123 1,138,231 5,691,156
1991 112,687,747 1,126,877 5,634,387
1992 113,721,706 1,137,217 5,686,085
1993 115,061,112 1,150,611 5,753,056
1994 117,333,779 1,173,338 5,866,689
1995 119,487,813 1,194,878 5,974,391
1996 121,555,156 1,215,552 6,077,758
1997 123,852,016 1,238,520 6,192,601
1998 126,107,596 1,261,076 6,305,380
1999 128,340,271 1,283,403 6,417,014
2000
Income floor on
percentiles
(current dollars):
1986 N/A 147,863 68,362
1987 N/A 145,624 69,222
1988 N/A 161,774 73,451
1989 N/A 169,603 77,542
1990 N/A 174,813 80,400
1991 N/A 180,268 83,300
1992 N/A 197,031 87,370
1993 N/A 199,698 88,992
1994 N/A 210,742 93,186
1995 N/A 224,523 98,420
1996 N/A 246,268 103,489
1997 N/A 268,889 110,949
1998 N/A 301,513 120,262
1999 N/A 332,253 126,643
2000 N/A 353,945 134,128
Income floor on
percentiles
(constant
dollars): (1)
1986 N/A 134,912 62,374
1987 N/A 128,190 60,935
1988 N/A 136,749 62,089
1989 N/A 136,777 62,534
1990 N/A 133,751 61,515
1991 N/A 132,355 61,160
1992 N/A 140,436 62,274
1993 N/A 138,199 61,586
1994 N/A 142,201 62,879
1995 N/A 147,325 64,580
1996 N/A 156,959 65,959
1997 N/A 167,532 69,127
1998 N/A 183,962 73,375
1999 N/A 199,432 76,016
2000 N/A 205,543 77,891
Income (millions
of dollars):
1986 2,804,691 427,513 796,935
1987 2,856,118 363,880 749,240
1988 3,153,639 484,675 911,170
1989 3,336,571 486,976 947,363
1990 3,497,118 504,687 987,582
1991 3,577,337 478,756 985,590
1992 3,763,002 556,421 1,090,019
1993 3,849,532 554,075 1,105,014
1994 4,033,642 579,564 1,161,972
1995 4,317,506 653,717 1,284,726
1996 4,670,644 772,868 1,462,979
1997 5,112,706 918,007 1,679,877
1998 5,626,390 1,072,779 1,925,214
1999 6,082,931 1,236,081 2,166,370
2000 6,601,494 1,424,436 2,430,957
Total income tax
(millions of
dollars): (2)
1986 366,763 93,128 155,553
1987 368,924 89,908 158,485
1988 412,549 112,208 186,793
1989 432,643 107,508 188,588
1990 446,906 110,530 192,991
1991 448,177 107,926 192,548
1992 476,067 127,361 216,303
1993 502,638 142,329 235,908
1994 534,693 150,133 250,770
1995 588,292 173,877 284,036
1996 658,059 208,071 331,404
1997 731,123 238,978 376,046
1998 783,437 262,464 413,303
1999 877,199 307,382 479,531
2000 980,459 355,911 546,102
Average tax rate
(percentage): (3)
1986 13.08 21.78 19.52
1987 12.92 24.71 21.15
1988 13.08 23.15 20.50
1989 12.97 22.08 19.91
1990 12.78 21.90 19.54
1991 12.53 22.54 19.54
1992 12.65 22.89 19.84
1993 13.06 25.69 21.35
1994 13.26 25.90 21.58
1995 13.63 26.60 22.11
1996 14.09 26.92 22.65
1997 14.30 26.03 22.39
1998 13.92 24.47 21.47
1999 14.42 24.87 22.14
2000 14.85 24.99 22.46
Income share
(percentage):
1986 100.00 15.24 28.41
1987 100.00 12.74 26.23
1988 100.00 15.37 28.89
1989 100.00 14.60 28.39
1990 100.00 14.43 28.24
1991 100.00 13.38 27.55
1992 100.00 14.79 28.97
1993 100.00 14.39 28.71
1994 100.00 14.37 28.81
1995 100.00 15.14 29.76
1996 100.00 16.55 31.32
1997 100.00 17.96 32.86
1998 100.00 19.07 34.22
1999 100.00 20.32 35.61
2000 100.00 21.58 36.82
Total Income tax
share (percentage):
1986 100.00 25.39 42.41
1987 100.00 24.37 42.96
1988 100.00 27.20 45.28
1989 100.00 24.85 43.59
1990 100.00 24.73 43.18
1991 100.00 24.08 42.96
1992 100.00 26.75 45.44
1993 100.00 28.32 46.93
1994 100.00 28.08 46.90
1995 100.00 29.56 48.28
1996 100.00 31.62 50.36
1997 100.00 32.69 51.43
1998 100.00 33.50 52.76
1999 100.00 35.04 54.67
2000 100.00 36.30 55.70
Descending cumulative percentiles
Item, tax year Top Top Top
10 percent 25 percent 50 percent
(4) (5) (6)
Number of returns:
1986 10,198,881 25,497,201 50,994,402
1987 10,619,162 26,547,906 53,095,812
1988 10,887,915 27,219,788 54,439,577
1989 11,132,884 27,832,209 55,664,418
1990 11,271,796 28,179,490 56,358,980
1991 11,382,312 28,455,781 56,911,562
1992 11,268,775 28,171,937 58,343,874
1993 11,372,171 28,430,426 58,860,853
1994 11,506,111 28,765,278 57,530,556
1995 11,733,378 29,333,445 58,666,889
1996 11,948,781 29,871,953 59,743,906
1997 12,155,516 30,388,789 60,777,578
1998 12,385,202 30,963,004 61,926,008
1999 12,610,760 31,526,899 63,053,798
2000 12,834,027 32,085,068 64,170,135
Income floor on
percentiles
(current dollars):
1986 52,035 33,623 17,909
1987 53,094 34,165 17,959
1988 55,532 35,432 18,534
1989 58,429 36,783 19,152
1990 60,623 38,026 19,947
1991 62,413 38,913 20,302
1992 65,283 40,423 21,041
1993 66,685 41,013 21,390
1994 69,118 42,480 22,000
1995 72,210 43,860 22,575
1996 75,574 45,508 23,378
1997 79,598 47,738 24,551
1998 84,904 50,232 25,612
1999 89,172 52,399 26,487
2000 93,715 54,592 27,647
Income floor on
percentiles
(constant
dollars): (1)
1986 47,477 30,678 16,340
1987 46,738 30,075 15,809
1988 46,942 29,951 15,667
1989 47,120 29,664 15,445
1990 46,383 29,094 15,262
1991 45,825 28,571 14,906
1992 46,531 28,812 14,997
1993 46,149 28,383 14,803
1994 46,638 28,664 14,845
1995 47,382 28,780 14,813
1996 48,167 29,004 14,900
1997 49,594 29,743 15,297
1998 51,802 30,648 15,627
1999 53,525 31,452 15,899
2000 54,422 31,703 16,055
Income (millions
of dollars):
1986 1,097,550 1,732,231 2,368,620
1987 1,067,438 1,741,747 2,411,715
1988 1,255,108 1,973,061 2,683,524
1989 1,317,619 2,085,003 2,838,481
1990 1,376,162 2,182,091 2,973,847
1991 1,390,924 2,224,979 3,038,428
1992 1,509,728 2,369,701 3,206,490
1993 1,537,285 2,422,475 3,278,866
1994 1,617,250 2,544,400 3,436,167
1995 1,772,890 2,754,988 3,692,267
1996 1,984,931 3,025,107 4,015,461
1997 2,242,353 3,353,245 4,409,075
1998 2,542,399 3,742,006 4,869,467
1999 2,825,789 4,099,929 5,290,805
2000 3,138,299 4,495,910 5,758,808
Total income tax
(millions of
dollars): (2)
1986 198,862 277,578 342,296
1987 204,050 282,970 346,228
1988 235,121 320,152 388,631
1989 240,229 333,285 407,106
1990 245,856 342,926 420,345
1991 246,745 345,168 423,180
1992 272,361 372,352 451,494
1993 294,238 397,261 477,997
1994 314,909 423,743 508,540
1995 354,427 471,035 560,748
1996 407,726 532,750 628,918
1997 459,674 595,060 699,131
1998 503,577 644,182 749,547
1999 577,903 729,679 841,172
2000 654,155 819,937 941,304
Average tax rate
(percentage): (3)
1986 18.12 16.02 14.45
1987 19.12 16.25 14.36
1988 18.73 16.23 14.48
1989 18.23 15.98 14.34
1990 17.87 15.72 14.13
1991 17.74 15.51 13.93
1992 18.04 15.71 14.08
1993 19.14 16.40 14.58
1994 19.47 16.65 14.80
1995 19.99 17.10 15.19
1996 20.54 17.61 15.66
1997 20.50 17.75 15.86
1998 19.81 17.21 15.39
1999 20.45 17.80 15.90
2000 20.84 18.24 16.35
Income share
(percentage):
1986 39.13 61.76 84.45
1987 37.37 60.98 84.44
1988 39.80 62.56 85.09
1989 39.49 62.49 85.07
1990 39.35 62.40 85.04
1991 38.88 62.20 84.94
1992 40.12 62.97 85.21
1993 39.93 62.93 85.18
1994 40.09 63.08 85.19
1995 41.06 63.81 85.52
1996 42.50 64.77 85.97
1997 43.86 65.59 86.24
1998 45.19 66.51 86.55
1999 46.45 67.40 86.98
2000 47.54 68.10 87.23
Total Income tax
share (percentage):
1986 54.22 75.68 93.33
1987 55.31 76.70 93.85
1988 56.99 77.60 94.20
1989 55.53 77.03 94.10
1990 55.01 76.73 94.06
1991 55.06 77.02 94.42
1992 57.21 78.21 94.84
1993 58.54 79.04 95.10
1994 58.90 79.25 95.11
1995 60.25 80.07 95.32
1996 61.96 80.96 95.57
1997 62.87 81.39 95.62
1998 64.28 82.23 95.67
1999 65.88 83.18 95.89
2000 66.72 83.63 96.01
Footnotes at end of Table 8.
Table 8.--Returns with Positive "1979 Income Concept" Income:
Number of Returns, Shares of Income and Total Income Tax, and
Average Tax Rates, by Selected Ascending Cumulative Percentiles
of Returns Based on Income Size, Tax Years 1986-2000
[All figures ere estimates based on samples]
Ascending
cumulative percentiles
Item, tax year Total Bottom Bottom
50 percent 75 percent
(1) (2) (3)
Number of returns:
1986 101,988,805 50,994,402 76,491,604
1987 106,191,624 53,095,812 79,643,718
1988 108,879,154 54,439,577 81,659,366
1989 111,328,835 55,664,417 83,496,626
1990 112,717,959 56,358,980 84,538,469
1991 113,823,123 56,911,562 85,367,342
1992 112,687,747 56,343,874 84,515,810
1993 113,721,706 56,860,853 85,291,280
1994 115,061,112 57,530,556 86,295,834
1995 117,333,779 58,666,890 88,000,334
1996 119,487,813 59,743,907 89,615,860
1997 121,555,156 60,777,578 91,166,367
1998 123,852,016 61,926,008 92,889,012
1999 126,107,596 63,053,798 94,580,697
2000 128,340,271 64,170,135 96,255,203
Income (millions
of dollars):
1986 2,804,691 436,071 1,072,460
1987 2,856,118 444,403 1,114,372
1988 3,153,639 470,115 1,180,578
1989 3,336,571 498,089 1,251,567
1990 3,497,118 523,271 1,315,027
1991 3,577,337 538,910 1,352,358
1992 3,763,002 556,512 1,393,300
1993 3,849,532 570,666 1,427,057
1994 4,033,642 597,475 1,489,242
1995 4,317,506 625,239 1,562,518
1996 4,670,644 655,183 1,645,537
1997 5,112,706 703,631 1,759,461
1998 5,626,390 756,923 1,884,384
1999 6,082,931 792,125 1,983,002
2000 6,601,494 842,686 2,105,584
Total income
tax (millions
of dollars): (2)
1986 366,763 24,467 89,186
1987 368,924 22,696 85,954
1988 412,549 23,918 92,397
1989 432,643 25,537 99,358
1990 446,906 26,562 103,980
1991 448,177 24,997 103,009
1992 476,067 24,573 103,715
1993 502,638 24,641 105,377
1994 534,693 26,153 110,950
1995 588,292 27,544 117,257
1996 658,059 29,142 125,310
1997 731,123 31,992 136,063
1998 783,437 33,889 139,249
1999 877,199 36,027 147,520
2000 980,459 39,155 160,521
Average tax rate
(percentage): (3)
1986 13.08 5.61 8.32
1987 12.92 5.11 7.71
1988 13.08 5.09 7.83
1989 12.97 5.13 7.94
1990 12.78 5.08 7.91
1991 12.53 4.64 7.62
1992 12.65 4.42 7.44
1993 13.06 4.32 7.38
1994 13.26 4.38 7.45
1995 13.63 4.41 7.50
1996 14.09 4.45 7.62
1997 14.30 4.55 7.73
1998 13.92 4.48 7.39
1999 14.42 4.55 7.44
2000 14.85 4.65 7.62
Income share
(percentage):
1986 100.00 15.55 38.24
1987 100.00 15.56 39.02
1988 100.00 14.91 37.44
1989 100.00 14.93 37.51
1990 100.00 14.96 37.60
1991 100.00 15.06 37.80
1992 100.00 14.79 37.03
1993 100.00 14.82 37.07
1994 100.00 14.81 36.92
1995 100.00 14.48 36.19
1996 100.00 14.03 35.23
1997 100.00 13.76 34.41
1998 100.00 13.45 33.49
1999 100.00 13.02 32.60
2000 100.00 12.77 31.90
Total income tax
share (percentage):
1986 100.00 6.67 24.32
1987 100.00 6.15 23.30
1988 100.00 5.80 22.40
1989 100.00 5.90 22.97
1990 100.00 5.94 23.27
1991 100.00 5.58 22.98
1992 100.00 5.16 21.79
1993 100.00 4.90 20.96
1994 100.00 4.89 20.75
1995 100.00 4.68 19.93
1996 100.00 4.43 19.04
1997 100.00 4.38 18.61
1998 100.00 4.33 17.77
1999 100.00 4.11 16.82
2000 100.00 3.99 16.37
Ascending cumulative percentiles
Item, tax year Bottom Bottom Bottom
90 percent 95 percent 99 percent
(4) (5) (6)
Number of returns:
1986 91,789,924 96,889,365 100,968,917
1987 95,572,462 100,882,043 105,129,708
1988 97,991,239 103,435,196 107,790,362
1989 100,195,951 105,762,393 110,215,547
1990 101,446,163 107,082,061 111,590,779
1991 102,440,811 108,131,967 112,684,892
1992 101,418,972 107,053,360 111,560,870
1993 102,349,535 108,035,621 112,584,489
1994 103,555,001 109,308,056 113,910,501
1995 105,600,401 111,467,090 116,160,441
1996 107,539,032 113,513,422 118,292,935
1997 109,399,640 115,477,398 120,339,604
1998 111,466,814 117,659,415 122,613,496
1999 113,496,836 119,802,216 124,846,520
2000 115,506,243 121,923,257 127,056,868
Income (millions
of dollars):
1986 1,707,142 2,007,756 2,377,178
1987 1,788,680 2,106,878 2,492,238
1988 1,898,531 2,242,469 2,668,964
1989 2,018,952 2,389,207 2,849,595
1990 2,120,956 2,509,535 2,992,431
1991 2,186,413 2,591,748 3,098,582
1992 2,253,273 2,672,983 3,206,581
1993 2,312,247 2,744,518 3,295,456
1994 2,416,392 2,871,670 3,454,078
1995 2,544,615 3,032,780 3,663,789
1996 2,685,713 3,207,665 3,897,777
1997 2,870,353 3,432,828 4,194,699
1998 3,083,991 3,701,176 4,553,611
1999 3,257,142 3,916,561 4,846,850
2000 3,463,195 4,170,537 5,177,058
Total income
tax (millions
of dollars): (2)
1986 167,901 211,210 273,635
1987 164,874 210,439 279,016
1988 177,429 225,756 300,341
1989 192,414 244,055 325,135
1990 201,050 253,915 336,376
1991 201,432 255,629 340,251
1992 203,706 259,764 348,706
1993 208,400 266,730 360,309
1994 219,783 283,923 384,560
1995 233,864 304,256 414,415
1996 250,333 326,655 449,988
1997 271,450 355,078 492,146
1998 279,860 370,134 520,973
1999 299,294 397,669 569,817
2000 326,304 434,357 624,548
Average tax rate
(percentage): (3)
1986 9.84 10.52 11.51
1987 9.22 9.99 11.20
1988 9.35 10.07 11.25
1989 9.53 10.21 11.41
1990 9.48 10.12 11.24
1991 9.21 9.86 10.98
1992 9.04 9.72 10.87
1993 9.01 9.72 10.93
1994 9.10 9.89 11.13
1995 9.19 10.03 11.31
1996 9.32 10.18 11.54
1997 9.46 10.34 11.73
1998 9.07 10.00 11.44
1999 9.19 10.15 11.76
2000 9.42 10.41 12.06
Income share
(percentage):
1986 60.87 71.59 84.76
1987 62.63 73.77 87.26
1988 60.20 71.11 84.63
1989 60.51 71.61 85.40
1990 60.65 71.76 85.57
1991 61.12 72.45 86.62
1992 59.88 71.03 85.21
1993 60.07 71.29 85.61
1994 59.91 71.19 85.63
1995 58.94 70.24 84.86
1996 57.50 68.68 83.45
1997 56.14 67.14 82.04
1998 54.81 65.78 80.93
1999 53.55 64.39 79.68
2000 52.46 63.18 78.42
Total income tax
share (percentage):
1986 45.78 57.59 74.61
1987 44.69 57.04 75.63
1988 43.01 54.72 72.80
1989 44.47 56.41 75.15
1990 44.99 56.82 75.27
1991 44.94 57.04 75.92
1992 42.79 54.56 73.25
1993 41.46 53.07 71.68
1994 41.10 53.10 71.92
1995 39.75 51.72 70.44
1996 38.04 49.64 68.38
1997 37.13 48.57 67.31
1998 35.72 47.24 66.50
1999 34.12 45.33 64.96
2000 33.28 44.30 63.70
N/A--Not applicable.
(1) For Table 7, constant dollars were calculated using the U.S. Bureau
of Labor Statistics' consumer price index for urban consumers (CPI-U,
1982-84=100). See footnote 2 of this article for further details.
(2) Total income tax is the sum of income tax after credits and the
alternative minimum tax for Tax Year 1999 and prior years. For Tax
Year 2000, alternative minimum tax is included in income tax before
credits (see Figure E).
(3) Average tax rate was computed by dividing total income tax
(see footnote 3) by income, using the 1979 income concept (see
text and Figure 1).
Figure A
Adjusted Gross Income, Total Income Tax, Average Tax Rate,
and Average Total Income Tax, Tax Years 1986-2000
[Money amounts are in billions of dollars, except where indicated]
Taxable returns
Adjusted
As a gross
percentage income Total
Tax Total number Number of of total (less income
year of returns returns returns (1) deficit) tax
(1) (2) (3) (4) (5)
Using each tax year's adjusted gross income
1986 103,045,170 83,967,413 81.5 2,440 367
1987 106,996,270 86,723,796 81.1 2,701 369
1988 109,708,280 87,135,332 79.4 2,990 413
1989 112,135,673 89,178,355 79.5 3,158 433
1990 113,717,138 89,862,434 79.0 3,299 447
1991 114,730,123 88,733,587 77.3 3,337 448
1992 113,604,503 86,731,946 76.3 3,484 476
1993 114,601,819 86,435,367 75.4 3,564 503
1994 115,943,131 87,619,446 75.6 3,737 535
1995 118,218,327 89,252,989 75.5 4,008 588
1996 120,351,208 90,929,350 75.6 4,342 658
1997 122,421,991 93,471,200 76.4 4,765 731
1998 124,770,662 93,047,898 74.6 5,160 789
1999 127,075,145 94,546,080 74.4 5,581 877
2000 129,373,500 96,817,603 74.8 6,083 981
Using 1979 Income Concept (5)
1986 103,045,170 83,967,413 81.5 2,703 367
1987 106,996,270 86,723,796 81.1 2,736 369
1988 109,708,280 87,135,332 79.4 3,011 413
1989 112,135,673 89,178,355 79.5 3,188 433
1990 113,717,138 89,862,434 79.0 3,335 447
1991 114,730,123 88,733,587 77.3 3,387 448
1992 113,604,503 86,731,946 76.3 3,553 476
1993 114,601,819 86,435,367 75.4 3,625 503
1994 115,943,131 87,619,446 75.6 3,796 535
1995 118,218,327 89,252,989 75.5 4,075 588
1996 120,351,208 90,929,350 75.6 4,418 658
1997 122,421,991 93,471,200 76.4 4,849 731
1998 124,770,662 93,047,898 74.6 5,299 789
1999 127,075,145 94,546,080 74.4 5,736 877
2000 129,373,500 96,817,603 74.8 6,294 981
Taxable returns
Average per return (whole dollars) (3)
Constant
Current dollars dollars (4)
Adjusted
gross
Average Adjusted Total income Total
Tax tax rate gross income income (less income
year (percent) (2,3) (less deficit) tax deficit) tax
(6) (7) (8) (9) (10)
Using each tax year's adjusted gross income
1986 15.1 29,062 4,374 26,516 3,991
1987 13.7 31,142 4,257 27,414 3,747
1988 13.8 34,313 4,738 29,005 4,005
1989 13.7 35,415 4,855 28,560 3,915
1990 13.6 36,711 4,976 28,088 3,807
1991 13.4 37,603 5,054 27,609 3,711
1992 13.7 40,168 5,491 28,630 3,914
1993 14.1 41,233 5,817 28,535 4,026
1994 14.3 42,646 6,104 28,776 4,119
1995 14.7 44,901 6,593 29,463 4,326
1996 15.2 47,750 7,239 30,433 4,614
1997 15.3 50,980 7,824 31,763 4,875
1998 15.3 55,458 8,475 33,836 5,171
1999 15.7 59,028 9,280 35,431 5,570
2000 16.1 62,832 10,129 36,488 5,882
Using 1979 Income Concept (5)
1986 13.6 32,194 4,374 29,374 3,991
1987 13.5 31,551 4,257 27,774 3,747
1988 13.7 34,556 4,738 29,210 4,005
1989 13.6 35,752 4,855 28,832 3,915
1990 13.4 37,108 4,976 28,392 3,807
1991 13.2 38,169 5,054 28,024 3,711
1992 13.4 40,964 5,491 29,198 3,914
1993 13.9 41,938 5,817 29,023 4,026
1994 14.1 43,322 6,104 29,232 4,119
1995 14.4 45,655 6,593 29,957 4,326
1996 14.9 48,582 7,239 30,964 4,614
1997 15.1 51,875 7,824 32,321 4,875
1998 14.9 56,947 8,475 34,745 5,171
1999 15.3 60,666 9,280 36,414 5,570
2000 15.6 65,012 10,129 37,754 5,882
(1) Number of taxable returns (column 2) divided by total number
of returns (column 1).
(2) Average tax rate is "total income tax" (column 5) as a percentage
of adjusted gross income less deficit (AGI) (column 4).
(3) The average adjusted gross income (less deficit), average total
income tax, and average tax rate were calculated from unrounded data.
(4) Constant dollars were calculated, using the U.S. Bureau of Labor
Statistics' consumer price index for urban consumers (CPI-U,
1982-84=100). See footnote 2 of this article for further details.
(5) These statistics are based on adjusted gross income (AGI) (less
deficit) recomputed to reflect the 1979 Income Concept, thus enabling
more valid comparisons to be made of the average tax rates among
years. Changes in the definition of AGI among years render direct
comparison of the unadjusted figures misleading. For additional
information, see Statistics of Income--Individual Income Tax Returns,
for 1986-2000.
Figure B
Taxable Returns: Number of Returns, Adjusted Gross Income, and Total
Income Tax, by Size of Adjusted Gross Income, Tax Years 1999 and 2000
[Number of returns is in thousands--money amounts are in
millions of dollars]
Size of adjustment
gross income
$1
Under under
Tax year, item Total $1 (1) $10,000
(1) (2) (3)
Tax Year 2000:
Number of taxable returns 96,818 6 7,831
Adjusted gross income
(less deficit) 6,083,263 -5,646 49,981
Total income tax 980,645 124 2,231
Average tax rate (percent) (2) 16.1 (3) 4.5
Tax Year 1999:
Number of taxable returns 94,546 5 8,047
Adjusted gross income
(less deficit) 5,580,849 -6,400 51,208
Total income tax 877,401 109 2,220
Average tax rate (percent) (2) 15.7 (3) 4.3
Increase in average tax rates,
2000 over 1999 0.4 (4) 0.1
Size of adjustment gross income
$10,000 $20,000 $30,000
under under under
Tax year, item $20,000 $30,000 $50,000
(4) (5) (6)
Tax Year 2000:
Number of taxable returns 14,476 14,863 23,253
Adjusted gross income
(less deficit) 219,038 370,902 910,893
Total income tax 14,408 29,533 85,969
Average tax rate (percent) (2) 6.6 8.0 9.4
Tax Year 1999:
Number of taxable returns 14,770 15,175 22,544
Adjusted gross income
(less deficit) 222,963 378,381 881,156
Total income tax 14,741 30,392 83,160
Average tax rate (percent) (2) 6.6 8.0 9.4
Increase in average tax rates,
2000 over 1999 -- -0.1 --
Size of adjustment gross income
$50,000 $100,000 $200,000
under under under
Tax year, item $100,000 $200,000 $500,000
(7) (8) (9)
Tax Year 2000:
Number of taxable returns 25,542 8,078 2,134
Adjusted gross income
(less deficit) 1,774,029 1,065,629 613,255
Total income tax 215,549 184,035 146,454
Average tax rate (percent) (2) 12.2 17.3 23.9
Tax Year 1999:
Number of taxable returns 24,480 7,098 1,875
Adjusted gross income
(less deficit) 1,689,529 933,899 542,108
Total income tax 205,023 162,225 130,274
Average tax rate (percent) (2) 12.1 17.4 24.0
Increase in average tax rates,
2000 over 1999 -- -0.1 -0.1
Size of adjustment
gross income
$500,000 $1,000,000
under or
Tax year, item $1,000,000 more
(10) (11)
Tax Year 2000:
Number of taxable returns 396 239
Adjusted gross income
(less deficit) 268,765 816,418
Total income tax 76,022 226,320
Average tax rate (percent) (2) 28.3 27.7
Tax Year 1999:
Number of taxable returns 348 205
Adjusted gross income
(less deficit) 235,524 652,480
Total income tax 66,965 182,293
Average tax rate (percent) (2) 28.4 27.9
Increase in average tax rates,
2000 over 1999 -0.1 -0.2
(1) Includes returns with adjusted gross deficit. Tax in these
returns represents some combination of alternative minimum tax,
Form 4972 tax on lump-sum distributions from qualified retirement
plans, and Form 8814 tax on a child's interest and dividends not
reflected in adjusted gross income or taxable income.
(2) Average tax rate is total income tax as a percentage of
adjusted gross income less deficit.
(3) Percentage not computed.
(4) Increase not computed.
NOTE: Detail may not add to totals because of rounding.
Figure C
Returns with Modified Taxable Income: Tax Generated at All Rates
on Returns with the Indicated Marginal Tax Rate, Tax Year 2000
[Money amounts are in thousands of dollars]
Number of returns
Marginal tax
rate classes Number Percent of total
(1) (2)
All rates 105,254,144 100.0
10 percent 1,239,906 1.2
15 percent (Form 8814) (1) 22,171 (2)
15 percent 68,277,153 64.9
20 percent 1,396,709 1.3
25 percent 45,524 (2)
28 percent (capital gains) (3) 67,436 0.1
28 percent 27,243,957 25.9
31 percent 3,924,396 3.7
36 percent 1,569,935 1.5
39.6 percent 921,356 0.9
Form 8615 (4) 545,600 0.5
Modified taxable income
Marginal tax
rate classes Amount Percent of total
(3) (4)
All rates 4,544,454,724 100.0
10 percent 5,526,181 0.1
15 percent (Form 8814) (1) 25,701 (2)
15 percent 1,015,294,204 22.3
20 percent 163,406,083 3.6
25 percent 7,177,733 0.2
28 percent (capital gains) (3) 5,131,252 0.1
28 percent 1,549,300,652 34.1
31 percent 471,862,727 10.4
36 percent 369,823,904 8.1
39.6 percent 951,976,119 20.9
Form 8615 (4) 4,930,169 0.1
Tax generated
Marginal tax
rate classes Amount Percent of total
(5) (6)
All rates 1,008,640,394 100.0
10 percent 552,754 0.1
15 percent (Form 8814) (1) 3,855 (2)
15 percent 151,410,696 15.0
20 percent 29,337,306 2.9
25 percent 1,425,500 0.1
28 percent (capital gains) (3) 1,039,695 0.1
28 percent 297,985,907 29.5
31 percent 112,453,232 11.1
36 percent 99,754,259 9.9
39.6 percent 313,510,924 31.1
Form 8615 (4) 1,166,267 0.1
(1) Form 8814 was filed for a dependent child under age 14 for
whom the parents made an election to report the child's investment
income (if it was from interest or dividends totaling between $700
and $7,000) on the parents' income tax return.
(2) Less than 0.05 percent.
(3) Returns with net long-term capital gains in excess of net
short-term capital losses taxed at the 28-percent rate, which
otherwise (based on ordinary income) would be taxed at a higher
rate than 28 percent.
(4) Form 8615 was filed for a child under age 14 to report the
child's investment income in excess of $1,400. The returns in
this rate classification are not distributed by tax rate.
NOTE: Detail may not add to totals because of rounding.
Figure D
Returns with Modified Taxable Income: Percentages of Returns,
Modified Taxable Income, and Tax Generated by Marginal Tax Rate
Classification, Tax Years 1998-2000
Number of Returns
1998 1999 2000
(100.8 million (102.8 million (105.3 million
Percentage returns) returns) returns)
10 percent 0.5 1.1 1.2
15 percent 67.5 66.2 64.9
20 percent 0.9 1.2 1.3
25 percent 0.0 0.1 0.0
28 percent (1) 24.7 25.3 25.9
31 percent 3.0 3.4 3.7
36 percent 1.3 1.4 1.5
39.6 percent 0.7 0.8 0.9
Modified Taxable Income
1998 1999 2000
Percentage ($3.8 trillion) ($4.1 trillion) ($4.5 trillion)
10 percent 0.1 0.1 0.1
15 percent 25.7 24.1 22.3
20 percent 2.4 3.2 3.6
25 percent 0.1 0.2 0.2
28 percent (1) 35.4 34.9 34.1
31 percent 9.5 9.9 10.4
36 percent 7.5 7.8 8.1
39.6 percent 17.9 19.6 20.9
Tax Generated
2000
1998 1999 ($1,008.6
Percentage ($813.2 billion) ($906.4 billion) billion)
10 percent 0.0 0.0 0.1
15 percent 17.8 16.4 15.0
20 percent 2.1 2.6 2.9
25 percent 0.1 0.2 0.1
28 percent (1) 31.5 30.5 29.5
31 percent 10.5 10.8 11.1
36 percent 9.4 9.6 9.9
39.6 percent 27.3 29.6 31.1
(1) Includes 28 percent for returns with net long-term capital
gains in excess of net short-term capital losses.
NOTE: Returns in the "Form 8615" and "Form 8814" categories
were included in the calculation of the percentages, but are
not shown separately. Detail may not add to 100 percent
because of rounding.
Figure E
Derivation of 2000 Total Income Tax as Shown
in Statistics of Income
[Money amounts are in billions of dollars]
Tax generated from tax rate schedules or tax table 1,008.6
PLUS:
Tax on lump-sum distributions from qualified
retirement plans 0.1
Alternative minimum tax 9.6
EQUALS:
Income tax before credits 1,018.2
LESS: Tax credits, total (1) 37.7
Child-care credit 2.8
Child tax credit (1) 19.7
Education credit 4.9
Foreign tax credit 6.0
General business credit 0.8
Earned income credit (limited to the amount
needed to reduce total income tax to zero) 2.0
Credit for prior-year minimum tax 1.3
Other credits (2) 0.2
EQUALS:
Income tax after credits 980.5
PLUS: Trusts accumulation distribution 0.1
EQUALS:
Total Income tax 980.6
(1) Does not include the additional child tax credit which
for 2000 was $977.6 million.
(2) Includes the elderly or disabled credit, empowerment zone
employment credit, mortgage interest credit, adoption credit,
nonconventional source fuel credit, and other credits
NOTE: Detail may not add to totals because of rounding.
Figure F
Returns with Alternative Minimum Tax Computation Reported on Form
6251: Total Adjustments and Preferences, and Alternative Minimum
Taxable Income and Tax, by Size of Adjusted Gross Income,
Tax Years 1999 and 2000
[Money amounts are in thousands of dollars]
Alternative
minimum
Total adjustments and taxable
preferences (1) income
Size of adjusted gross income Number of Amount Number of
returns returns
(1) (2) (3)
Tax Year 2000
All returns 4,668,843 116,693,913 4,674,927
No adjusted gross income (2) 85,443 1,474,623 85,262
$1 under $10,000 314,222 1,026,652 314,222
$10,000 under $20,000 241,475 1,248,547 241,475
$20,000 under $30,000 189,486 989,525 189,486
$30,000 under $40,000 209,270 1,418,881 209,270
$40,000 under $50,000 215,047 1,486,481 215,048
$50,000 under $75,000 594,332 5,638,126 594,528
$75,000 under $100,000 568,183 6,675,031 571,240
$100,000 under $200,000 1,097,292 20,063,494 1,099,350
$200,000 under $500,000 832,265 26,342,935 832,654
$500,000 under $1,000,000 187,674 12,198,541 187,992
$1,000,000 or more 134,153 38,131,077 134,397
Tax Year 1999
All returns 4,208,973 91,126,166 4,212,275
No adjusted gross income (2) 72,210 1,492,006 71,372
$1 under $10,000 363,667 1,140,156 364,622
$10,000 under $20,000 234,326 1,280,267 234,326
$20,000 under $30,000 199,112 1,240,407 199,120
$30,000 under $40,000 197,364 1,214,558 198,351
$40,000 under $50,000 209,137 1,476,528 209,137
$50,000 under $75,000 548,940 4,933,423 549,284
$75,000 under $100,000 451,415 5,504,769 451,758
$100,000 under $200,000 942,677 16,207,352 943,035
$200,000 under $500,000 714,132 19,785,761 715,014
$500,000 under $1,000,000 162,253 9,357,527 162,379
$1,000,000 or more 113,741 27,493,414 113,876
Alternative
minimum
taxable Alternative
income minimum tax
Size of adjusted gross income Amount Number of Amount
returns
(4) (5) (6)
Tax Year 2000
All returns 1,093,505,463 1,304,197 9,600,840
No adjusted gross income (2) -4,680,793 3,823 100,636
$1 under $10,000 1,417,120 3,058 8,131
$10,000 under $20,000 3,121,189 5,724 5,760
$20,000 under $30,000 4,146,827 3,544 8,260
$30,000 under $40,000 6,624,480 12,493 14,323
$40,000 under $50,000 8,658,725 20,063 19,819
$50,000 under $75,000 33,107,110 121,906 168,366
$75,000 under $100,000 44,771,889 177,433 244,174
$100,000 under $200,000 141,514,523 437,004 1,531,783
$200,000 under $500,000 231,645,543 416,198 3,340,500
$500,000 under $1,000,000 122,178,405 66,860 1,438,572
$1,000,000 or more 501,000,444 36,093 2,720,516
Tax Year 1999
All returns 890,836,550 1,018,063 6,477,687
No adjusted gross income (2) -4,091,048 4,829 109,076
$1 under $10,000 1,338,833 2,034 9,482
$10,000 under $20,000 3,180,511 5,219 10,981
$20,000 under $30,000 4,495,258 5,859 31,214
$30,000 under $40,000 6,231,667 11,688 12,857
$40,000 under $50,000 8,426,268 22,447 19, 781
$50,000 under $75,000 30,372,792 83,050 148,447
$75,000 under $100,000 35,348,980 143,729 248,555
$100,000 under $200,000 120,174,901 334,533 1,138,963
$200,000 under $500,000 198,681,460 322,600 2,042,634
$500,000 under $1,000,000 103,285,019 53,912 976,542
$1,000,000 or more 383,391,908 28,163 1,729,163
(1) See Figures M-1 and M-2 for the calculation of alternative
minimum taxable income and the list of alternative minimum tax
adjustments and preferences.
(2) Includes returns with adjusted gross deficit.
NOTE: Detail may not add to totals because of rounding.
Figure G
Marginal Tax Rate, Capital Gain Tax Rate, Alternative Minimum Tax Rate,
and Alternative Minimum Tax, Tax Years 1986-2000
[Tax rates are in percentages-money amounts are in thousands of
dollars]
Highest Highest
marginal Highest statutory Alternative minimum tax
Tax statutory capital alternative
year tax rate on gain tax minimum Number
ordinary rate tax of Amount
income rate returns
(1) (2) (3) (4) (5)
1986 50.0 20 (1) 20 608,907 6,713,149
1987 38.5 28 21 139,779 1,674,898
1988 28.0 (2) 28 (2) 21 113,562 1,027,884
1989 28.0 (2) 28 (2) 21 117,483 831,012
1990 28.0 (2) 28 (2) 21 132,103 830,313
1991 31.0 28 24 243,672 1,213,426
1992 31.0 28 24 287,183 1,357,063
1993 39.6 28 28 334,615 2,052,790
1994 39.6 28 28 368,964 2,212,094
1995 39.6 28 28 414,106 2,290,576
1996 39.6 28 28 477,898 2,812,746
1997 39.6 28 28 618,072 4,005,101
1998 39.6 28 28 853,433 5,014,549
1999 39.6 28 28 1,018,063 6,477,697
2000 39.6 28 28 1,304,197 9,600,840
(1) This tax rate was based on 60 percent of long-term capital gains
in excess of short-term capital losses) being excluded from income.
The remaining 40 percent of capital gains were taxed at the maximum
rate of 50 percent, creating a top capital gain rate of 20 percent.
(2) The tax rate schedule provided only two basic rates: 15 percent
and 28 percent. However, taxable income between certain amounts was
subject to an additional 5 percent tax, creating an "effective"
33-percent tax rate.
Figure H
Returns with Positive Adjusted Gross Income (AGI) and Positive "1979
Income Concept" Income: AGI and Income Floor Percentiles in Current
Dollars, Tax Years 1997-2000
Descending cumulative percentiles
Item Top 0.1 percent Top 1 percent Top 2 percent
(1) (2) (3)
Adjusted Gross
Income Floor
1997 1,123,627 250,736 170,318
1998 1,271,148 269,496 181,923
1999 1,424,103 293,415 195,676
2000 1,599,786 313,469 208,577
"1979 Income
Concept" Floor
1997 1,192,727 268,889 181,084
1998 1,343,653 301,513 200,088
1999 1,517,265 332,253 213,723
2000 1,696,322 353,945 227,971
Descending cumulative percentiles
Item Top 3 percent Top 4 percent Top 5 percent
(4) (5) (6)
Adjusted Gross
Income Floor
1997 137,444 119,476 108,048
1998 145,937 127,090 114,729
1999 156,802 135,188 120,846
2000 167,010 143,451 128,336
"1979 Income
Concept" Floor
1997 144,284 123,659 110,949
1998 157,637 134,327 120,262
1999 167,563 142,640 126,643
2000 178,317 151,331 134,128
Figure I
Returns with Positive Adjusted Gross Income (AGI) and "1979 Income
Concept" Income: Number of Returns, Shares of Income and Total Income
Tax, Income Floor on Percentiles in Current and Constant Dollars, and
Average Tax Rates, Tax Year 2000
Returns with positive AGI
Highest 0.1
Item All returns, percent
total of returns
Number of returns 128,227,143 128,227
Adjusted gross income floor on percentiles
(current dollars) N/A 1,599,786
Adjusted gross income floor on percentiles
(constant dollars) (1) N/A 929,028
Adjusted gross income (millions of
dollars) 6,423,977 678,318
Total income tax (millions of dollars) 980,521 185,771
Average tax rate (percentage) (2) 15.26 27.39
Adjusted gross income share (percentage) 100.00 10.56
Total income tax share (percentage) 100.00 18.95
Returns with positive 1979
income
Highest 0.1
Item All returns, percent
total of returns
Number of returns 128,340,271 128,340
Income floor on percentiles (current
dollars) N/A 1,696,322
Income floor on percentiles (constant
dollars) (1) N/A 985,088
Income (millions of dollars) 6,601,494 692,452
Total income tax (millions of dollars) 980,459 183,369
Average tax rate (percentage) (2) 14.85 26.48
Adjusted gross income share (percentage) 100.00 10.49
Total income tax share (percentage) 100.00 18.70
N/A--Not available.
(1) Constant dollars were calculated using the U.S. Bureau of Labor
Statistics' consumer price index for urban consumers (CPI-U,
1982-84=100). See footnote 2 of this article for further details.
(2) The average adjusted gross income (less deficit), average total
income tax, and average tax rate were calculated from unrounded data.
Figure K
Components of the 1979 Income Concept,
Tax Year 2000
Income or Loss:
Salaries and wages (1)
Interest (1)
Dividends (1)
Taxable refunds (1)
Alimony received (1)
Capital gain distributions not reported on Schedule D (1)
Capital gains reported on Schedule D minus allowable losses (1)
Other gains and losses (Form 4797) (1)
Business net income or loss (1)
Farm net income or loss (1)
Rent net income or loss (1)
Royalty net income or loss (1)
Partnership net income or loss (1)
S Corporation net income or loss (1)
Farm rental net income or loss (1)
Estate or trust net income or loss (1)
Unemployment compensation (1)
Depreciation in excess of straight-line depreciation (2)
Total pension income (3,4)
Other net income or loss (5)
Net operating loss (1)
Deductions:
Disallowed passive losses (Form 8582) (6)
Moving expenses (1)
Alimony paid (1)
Unreimbursed business expenses (6)
(1) Included in adjusted gross income (less deficit) (AGI)
for Tax Year 2000.
(2) Adjustment to add back excess depreciation (accelerated over
straight-line depreciation) deducted in the course of a trade or
business and included in net income (loss) amounts shown above.
(3) Includes taxable and tax-exempt pension and retirement
distributions, including IRA distributions.
(4) Not fully included in AGI for Tax Year 2000.
(5) Includes an adjustment to add back amounts reported
for the "foreign-earned income exclusion."
(6) Not included in AGI for Tax Year 2000.
Figure L
Income Tax Calculation for a Single Taxpayer
With One Exemption Who Used the Standard
Deduction, Tax Year 2000
[Money amounts are in whole dollars]
Item Amount
Adjusted gross income 310,000
Less: Exemption amount 0 (1)
Standard deduction amount 4,400
Equals: Taxable income 305,600
Tax based on tax rates for single taxpayers:
First $26,250 taxed at 15 percent 3,938
Next $37,300 taxed at 28 percent 10,444
Next $69,050 taxed at 31 percent 21,406
Next $155,750 taxed at 36 percent 56,070
Next $17,250 taxed at 39.6 percent 6,831
Total tax from tax rate schedule 98,688
(1) The exemption amount was phased out completely because AGI exceeded
$251,450.
Figure M1
Calculation of Alternative Minimum Taxable
Income (AMTI), Tax Year 2000
Taxable income before deduction for personal
exemptions
PLUS: Adjustments and preferences
PLUS: Net operating loss deduction
MINUS: Overall itemized deductions limitation
MINUS: Alternative tax net operating loss deduction (1)
EQUALS: Alternative minimum taxable income
(1) Limited to 90 percent of AMTI, except when depletion is present on
Form 6251. In this case, AMTI is recalculated, and the alternative tax
net operating loss deduction is limited to 90 percent of the recomputed
amount.
Figure M2
Alternative Minimum Tax Adjustments and Preferences, Tax Year 2000
* Standard deduction
* Medical and dental expenses from Schedule A (the lesser of
deductible medical and dental expenses or 2.5 percent of AGI)
* Deductions for State and local income, real estate, personal
property, and foreign taxes
* Deductions for interest on certain home mortgages not used to buy,
build, or improve the taxpayer's main home or second home
* Miscellaneous itemized deductions subject to the 2-percent-of-AGI
limitation
* Refunds of State and local income, real estate, personal property,
and foreign taxes previously deducted (negative)
* Investment interest expense (the result could be negative)
* Excess of depreciation on property placed in service after 1986
over less liberal methods allowed for alternative minimum tax (AMT)
purposes (straight-line or 150-percent declining balance method,
depending on the type of property; the result could be negative)
* Adjustment of gain or loss on property, the basis of which was
affected by accelerated depreciation or rapid amortization and which
was reduced for AMT purposes (the result could be negative)
* Incentive stock options which were exercised after 1987 (the
amount by which the value of the option when exercised exceeded the
price paid by the taxpayer; the result could be negative)
* Passive activity gains and losses allowed for regular tax purposes
for activities acquired before October 23, 1986, taking into account
AMT adjustments and preference items and any AMT prior-year unallowed
losses (the result could be negative)
* Difference between income distributions to beneficiaries of estates
and trusts for regular tax purposes and the amounts refigured for AMT
purposes (the result could be negative)
* Tax-exempt interest from private activity bonds issued after August
7, 1986
* Excess of circulation expenditures paid or incurred after 1986 over
allowable amortization if the expenditures were capitalized (the
result could be negative)
* Excess of percentage depletion deduction for sections 611 and 613
property over the adjusted basis (the result could be negative)
* Excess of accelerated depreciation on property placed in service
before 1987 over straight-line depreciation as refigured for AMT
purposes
* Adjustment from disallowing the installment sales method of
accounting for sales of inventory and stock in trade after March
1, 1986, with certain exceptions (the result could be negative)
* Amount by which excess intangible drilling costs deducted currently
over allowable amortization (if these costs were capitalized) was more
than 65 percent of the taxpayer's "net income" from oil, gas, and
geothermal wells, with exceptions for independent oil producers and
royalty owners
* Amount of net section 1231 gain or loss other than due to casualty
or theft from large partnerships
* Deferred income from long-term contracts entered into after
February 28, 1986, with certain exceptions and limitations (the result
could be negative)
* Adjustment for refigured loss from activities in which allowable
losses from partnerships or S Corporations were limited by "at-risk"
and other rules, taking into account AMT adjustments and preference
items (the result could be negative)
* Excess of mining exploration and development costs paid or incurred
after 1986 over allowable amortization if the expenditures were
capitalized (the result could be negative)
* Adjustment for taxable distributions received from a cooperative
(total AMT patronage dividend and per-unit retain allocation
adjustment)
* Excess of rapid amortization of pollution control facilities placed
in service after 1986 over otherwise allowable depreciation (the
result could be negative)
* Excess of research and experimental expenditures paid or incurred
after 1986 over allowable amortization if the expenditures were
capitalized (the result could be negative)
* Excluded gain, under the section 1202 gain on qualified small
business stock held more than 5 years, multiplied by 42%
* Adjustment for refigured tax shelter farm losses, taking into
account AMT adjustments and preference items (the result could be
negative)
* Related adjustments, refigured for AMT purposes, including section
179 expense deduction, expenses for business or rental use of the home,
conservation expenses, taxable IRA distributions, self-employed health
insurance deduction, Keogh retirement plan or self-employed SEP
deduction, and IRA deductions (the result could be negative)
Figure N
Coefficients of Variation for Selected Items, by Size of Adjusted Gross
Income, Tax Year 2000
[Coefficients of variation are percentages]
Modified taxable Tax
income generated
Size of adjusted gross income Number of
returns Amount Amount
(1) (2) (3)
Total 0.16 0.14 0.16
Under $2,000 (1) 4.81 5.76 6.18
$2,000 under $4,000 4.60 5.25 5.66
$4,000 under $6,000 3.20 4.09 4.42
$6,000 under $8,000 2.87 3.54 3.68
$8,000 under $10,000 2.42 2.91 3.03
$10,000 under $12,000 2.44 2.66 2.69
$12,000 under $14,000 2.27 2.55 2.57
$14,000 under $16,000 2.08 2.39 2.40
$16,000 under $18,000 2.02 2.31 2.32
$18,000 under $20,000 1.99 2.22 2.24
$20,000 under $25,000 1.28 1.41 1.42
$25,000 under $30,000 1.39 1.49 1.50
$30,000 under $40,000 1.04 1.10 1.11
$40,000 under $50,000 1.08 1.12 1.16
$50,000 under $75,000 0.81 0.84 0.89
$75,000 under $100,000 1.04 1.07 1.11
$100,000 under $200,000 1.01 0.92 0.92
$200,000 under $500,000 1.03 0.89 0.89
$500,000 under $1,000,000 0.95 0.86 0.88
$1,000,000 under $1,500,000 1.13 1.06 1.10
$1,500,000 under $2,000,000 1.06 1.08 1.11
$2,000,000 under $5,000,000 0.47 0.41 0.44
$5,000,000 under $10,000,000 0.46 0.37 0.39
$10,000,000 or more 0.02 0.02 0.02
Income Total
tax after income
credits tax
Size of adjusted gross income
Amount Amount
(4) (5)
Total 0.17 1.56
Under $2,000 (1) 6.24 32.66
$2,000 under $4,000 5.66 99.92
$4,000 under $6,000 4.43 99.89
$6,000 under $8,000 3.75 14.58
$8,000 under $10,000 3.24 15.70
$10,000 under $12,000 2.80 13.14
$12,000 under $14,000 2.75 6.12
$14,000 under $16,000 2.64 5.05
$16,000 under $18,000 2.64 4.39
$18,000 under $20,000 2.60 4.21
$20,000 under $25,000 1.62 3.25
$25,000 under $30,000 1.64 4.75
$30,000 under $40,000 1.17 7.00
$40,000 under $50,000 1.22 12.49
$50,000 under $75,000 0.91 15.74
$75,000 under $100,000 1.13 48.88
$100,000 under $200,000 0.93 27.79
$200,000 under $500,000 0.89 0.49
$500,000 under $1,000,000 0.93 0.69
$1,000,000 under $1,500,000 1.10 0.99
$1,500,000 under $2,000,000 1.11 1.01
$2,000,000 under $5,000,000 0.44 0.41
$5,000,000 under $10,000,000 0.39 0.38
$10,000,000 or more 0.02 0.02
(1) Includes returns with adjusted gross deficit.
Notes and References
[1] For Tax Years 1988 through 1990, the tax rate schedules provided only two basic rates: 15 percent and 28 percent. However, taxable income over certain levels was subject to a 33-percent tax rate to phase out the benefit of the 15-percent tax bracket (as compared to the 28-percent rate) and the deduction for personal exemptions. At the taxable income level where these benefits were completely phased out, the tax rate returned to 28 percent.
[2] U.S. Department of Labor, Bureau of Labor Statistics, Monthly Labor Review. The consumer price index (CPI-U) represents annual averages of monthly figures and reflects the buying of typical urban consumers (1982-84=100):
Year CPI-U Year CPI-U 2000 172.2 1992 140.5 1999 166.6 1991 136.2 1998 163.9 1990 130.7 1997 160.5 1989 124.0 1996 156.9 1988 118.3 1995 152.4 1987 113.6 1994 148.2 1986 109.6 1993 144.5 1985 107.6
[3] For further information about the Tax Reform Act of 1986, see U.S. Congress, Joint Committee on Taxation, General Explanation of the Tax Reform Act of 1986 (H.R. 3838, 99th Congress, Public Law 99-514), May 4, 1987.
[4] Nontaxable (i.e., tax-exempt) forms of income, such as interest on State and local government obligations, were not included in AGI and generally did not affect the marginal tax rate. However, in some situations the receipt of some forms of tax-exempt income, such as tax-exempt interest, could have influenced the taxability of other income, in particular Social Security benefits. When this situation occurred, the income made taxable by the receipt of other forms of nontaxable income was included in AGI.
[5] The income amounts on which these special computations for lump-sum distributions were based were not reflected in current-year AGI or current-year taxable income.
[6] For 2000, the total earned income credit was $32.3 billion. This amount includes the amount used to reduce the income tax ($2.0 billion), the amount used to reduce other taxes reported on individual income tax returns ($2.5 billion), and the amount refunded to taxpayers ($27.8 billion). Table 4 in Campbell and Parisi, "Individual Income Tax Returns, 2000," Statistics of Income Bulletin, Fall 2002, Volume 22, Number 2, shows these amounts.
[7] Total income tax does not include certain other taxes reported on the individual income tax return, such as self-employment tax (the Social Security tax on income from self-employment), the Social Security tax on certain tip income, tax from the recapture of prior-year investment or low-income housing credits, tax applicable to early withdrawals from an Individual Retirement Arrangement (IRA) or other qualified retirement plans, tax on trusts, accumulation and distributions, and household employment taxes. The statistics for "total tax liability," shown in Campbell and Parisi, "Individual Income Tax Returns, 2000," Statistics of Income Bulletin, Fall 2002, Volume 22, Number 2, include these taxes. For Tax Year 2000, total tax liability reported on 99.5 million returns was $1,017.5 billion.
[8] The percentile groupings of tax filers exclude returns with zero or negative AGI.
[9] For an explanation of the osculatory interpolation technique, see Oh, H. Lock, "Osculatory Interpolation with a Monotonicity Constraint," 1977 Proceedings of the American Statistical Association, Section on Statistical Computing, 1978.
David Campbell and Michael Parisi are economists with the Individual Returns Analysis Section. This article was prepared under the direction of Terry Nuriddin, Acting Chief.
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