Income Taxation of U.S. Households: Basic Facts
We use micro data from the U.S. Internal Revenue Service to document how households' tax liabilities vary with income, marital status and the number of dependents. We report facts on the distributions of average and marginal taxes, properties of the joint distributions of taxes paid and income, and discuss how taxes are affected by marital status and the number of children. The data reveals a large dispersion in tax rates and taxes paid. Ranking households according to the average tax rates they face, those at top 1% face taxes in excess of 27.5%, while the median tax rate is about 8%. About 14.5% of married and 31.8% of unmarried households do not pay any taxes. Given the progressivity in the system, tax liabilities are more unequally distributed than income. The top 5% (1%) of households account for 54% (34.8%) of total tax liabilities, while top 5% (1%) of households have 34.8% (20.3%) of total income. We also provide parametric estimates of tax functions for use in applied work in macroeconomics and public finance.
|Date of creation:||Mar 2011|
|Publication status:||published in Review of Economic Dynamics, 2014, 17(4), 559–581|
|Contact details of provider:|| Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany|
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
|Order Information:|| Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Javier Diaz-Gimenez & Josep Pijoan-Mas, 2006.
"Flat Tax Reforms in the U.S.: a Boon for the Income Poor,"
Computing in Economics and Finance 2006
400, Society for Computational Economics.
- Díaz-Giménez, Javier & Pijoan-Mas, Josep, 2006. "Flat Tax Reforms in the US: A Boon for the Income Poor," CEPR Discussion Papers 5812, C.E.P.R. Discussion Papers.