More individual income tax data from the IRS came out last week for Tax Year 2004. This time it was not by dollar cohorts, but by income percentile. We have released a new fiscal fact pertaining to this release entitled “Summary of Latest Federal Individual Income Tax Data.” The biggest story from this year’s data: Incomes for the wealthiest 1 percent increased dramatically in 2004, after falling dramatically from 2000 to 2002. This has led to their share of the tax burden also falling and rising in that time period. Another key note: Effective tax rates across all income cohorts pretty much held steady in 2004 compared to 2003, after falling each year from 2000 to 2003 as a result of the two tax cut measured put into law.
