How Do Transfers and Progressive Taxes Affect the Distribution of Income?
Federal tax rates vary by income group and tax source. The federal tax system redistributes income from high- and low-income taxpayers.
3 min readFederal tax rates vary by income group and tax source. The federal tax system redistributes income from high- and low-income taxpayers.
3 min readWhile some tax preferences like the earned income tax credit (EITC) and child tax credit benefit lower- and middle-income households, others, like itemized deductions, benefit high-income households.
4 min readIn the 1950s, when the top marginal income tax rate reached 92 percent, the top 1 percent of taxpayers paid an effective rate of only 16.9 percent. As top marginal rates have fallen, the tax burden on the rich has risen.
4 min readThe federal income tax and federal payroll tax make up a growing share of federal revenue. Individual income taxes have become a central pillar of the federal revenue system, now comprising nearly half of all revenue.
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