Notes and Sources

Cost of Tax Cuts:

All tax cut and income figures were produced by Citizens for Tax Justice and the Institute for Taxation and Economic Policy.

For a detailed explanation of the model used to calculate these figures, visit the Institute for Taxation and Economic Policy.

Changes to the tax code enacted in 2001 and 2003 and extended in 2010:

Change to the tax code enacted in 2001 and partially extended in 2010:

 Income figures include wages as well as capital gains, dividends, and other types of income.

"Households" refers to the number of tax returns submitted in each income group.

Figures for lost revenue from the tax cuts are expressed in nominal terms for each year of projected lost revenues.

 

Richer & Poorer:

Analysis by Citizens for Tax Justice and the Institute for Taxation and Economic Policy produced the average tax cut for each income group and average income by group.

Income figures include wages, capital gains, dividends, and other types of income.

Numbers are current for 2011.

Racial data by income group was collected by the U.S. Census Bureau and compiled in Money Income of Households--Distribution by Race, 2009.

Additional sources: Internal Revenue Service, Joint Committee on Taxation

 

What about Corporate Taxes:

Additional $165 billion in FY2012 if corporations had actually paid 35% of profits in taxes:

Calculation reflects 35% of CBO’s projected FY12 corporate profits with inventory valuation adjustment and capital consumption adjustment, less income from Federal Reserve Banks and net income received from equities in foreign corporations (calculated as a share of projected profits by the chained dollar weighted share of net foreign equity income over 2003-2008). Projected corporate income receipts under the alternative fiscal scenario (i.e., adjusted for continuation of the business tax extenders) are netted out of this revenue figure, as are S-corporation individual income taxes, excluding capital gains (calculated from Tax Policy Center Table T11-0154, adjusted from 2011 to fiscal 2012 with projected growth in corporate profits). Dividends and capital gains tax receipts from S-corporation are also netted out, calculated as 40% of capital gains and dividends receipts (the share from pass-throughs in 2007) weighted by S-corporation income as a share of total pass-through income. Lastly, this net decrease in corporate profitability is adjusted for contemporaneously decreased dividends disbursements and capital gains realizations, using the statutory 15% tax rate and the rule of thumb that roughly half of capital gains realizations and half of dividends are not taxed a second time at the individual income level (for an effective net-of-tax rate of 92.5%). See http://www.cbo.gov/sites/default/files/cbofiles/attachments/Jan2012_EconomicBaseline_Release.xls;  http://www.taxpolicycenter.org/numbers/displayatab.cfm?DocID=3035http://www.irs.gov/pub/irs-soi/10winbulcapitalassets.pdfhttp://www.taxpolicycenter.org/UploadedPDF/1000460_dividend.pdf; and Bureau of Economic Analysis National Income and Product Accounts Tables 6.16.D, 7.16, 1.1.4, and 3.2.