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1 1 (May 3, 2021)

handle is hein.crs/goveddy0001 and id is 1 raw text is: Congressional SResearch Service Taxpayers in the Top Income Tax Bracket: Statistics and Observations May 3, 2021 President Joe Biden has proposed increasing the top marginal income tax rate on ordinary income to 39.6%. The top marginal income tax rate was reduced from 39.6% to 37% in the 2017 tax revision (commonly referred to as the Tax Cuts and Jobs Act or TCJA; P. L. 115-97). TCJA's changes to individual income tax rates were enacted on a temporary basis, and are scheduled to expire after 2025. For 2021, the top marginal tax rate of 37% applies to income above $628,300 for married taxpayers filing joint returns and income above $523,600 for single filers and head of household filers. This Insight uses data from the Internal Revenue Service's Statistics of Income to examine taxpayers filing income tax returns that were subject to the top marginal income tax rate of 37% in 2018, as well as data and information from other sources to address questions about how raising the top marginal tax right might affect federal tax revenues and taxable income. How many taxpayers are subject to the top marginal income tax rate? Nearly 154 million tax returns were filed for the 2018 tax year. Of those, 0.5% were subject to the top marginal tax rate of 37%. By tax filing status, a greater share of married taxpayers were subject to the top rate compared to unmarried filers. In 2018, 1.2% of married taxpayers filing a joint return were subject to the 37% rate. For single and head of household filers, 0.1% of returns were subject to the top rate. How much income is subject to the top marginal income tax rate? Total adjusted gross income (AGI) on 2018 individual income tax returns was $11.6 trillion, while taxable income was $9.0 trillion. Nearly $1.6 trillion in taxable income was reported on tax returns subject to the top marginal tax rate of 37% in 2018. However, not all of that income was subject to the top marginal tax rate, since all taxpayers pay taxes according to a progressive, marginal income tax rate schedule. Other income is taxed at lower rates because it is attributable to capital gains or dividends (dividends and capital Congressional Research Service https://crsreports.congress.gov IN11653 CRS INSIGHT Prepared for Membersand Committeesof Congress

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