54 Million Federal Tax Returns Had No Income Tax Liability in 2011

The percentage of nonpayers (taxpayers who owe zero income taxes after taking their credits and deductions) began to climb significantly after the Tax Reform Act of 1986, which increased the value of the standard deduction and nearly doubled the size of the personal exemption. But the number of nonpayers has soared in recent years because of the expansion and creation of credits such as the Earned Income Tax Credit, the Child Credit, and various energy and education credits.

In 2011, roughly 54 million federal income tax filers had no income tax liability after deductions and credits. This amounts to 37 percent of the roughly 145 million tax returns filed that year. While high, this is not as high as 2009 when 58 million income tax filers, nearly 42 percent, were nonpayers. By contrast, the low point for nonpayers was 1969, when only 16 percent of filers had no income tax liability.

For more charts like the one below, see the second edition of our chart book, Putting a Face on America's Tax Returns.