Update: Top Surtax Rate of 3 Percent Agreed upon by House Democrats July 12, 2009 TF Staff TF Staff On Friday, before reports were released of a House plan that would push for a 3 percent surtax on very high-income tax returns, along with a 1 percent and 1.5 percent surtax at other high-income levels, the Tax Foundation released a study showing what the effective marginal tax rates would be in each state under a 4 percent surtax, which was the number that had been floated. On Monday, the Tax Foundation will release an updated version of the top effective marginal tax rates by state under a 3 percent surtax as opposed to a 4 percent surtax. According to Lori Montgomery’s article in Saturday’s Washington Post (posted Friday evening), the surtax would begin in 2011 and be imposed on AGI for married returns as follows: 1 percent surtax on AGI between $350,000 and $500,000 1.5 percent surtax on AGI between $500,000 and $1,000,000 3 percent surtax on AGI beyond $1,000,000 For single returns, the 1 percent surtax would begin at an AGI level of $280,000. Assuming the same 28/35 ratio (80%) on the top two surtax rates, a single would be hit with the 1.5 percent surtax at an AGI level of $400,000 and the 3 percent surtax at $800,000 in AGI. Stay informed on the tax policies impacting you. Subscribe to get insights from our trusted experts delivered straight to your inbox. Subscribe Share Tweet Share Email Topics Center for Federal Tax Policy Individual Income and Payroll Taxes