Income and Wealth Distribution

The Washington Times. America's days of economic dominance are numbered because we don't save. The government is borrowing like crazy, and households aren't doing much better. The personal savings rate -- the share of after-tax income that people set aside for a rainy day -- has been falling like a stone since the early 1980s.

The Internal Revenue Code has replaced traditional means-tested programs as the principal means for transferring income to low earners. The largest vehicle is the Earned Income Tax Credit (EITC), now supplemented by both the Child Tax Credit (CTC) and the Making Work Pay tax credit (MWP). This paper looks at the system's evolution, the important role played by the tax system in assisting low earners, and the complexities presented by the current approach. It offers principles to guide the design of a worker credit and child benefit that would replace the EITC, CTC, and MWP, along with a specific proposal.

Brookings Institution. Gary Burtless discusses the tax cut for new hires.

The retirement savings of American households took a big hit when the stock market crashed in 2008. Recently, however, a good portion of these losses has been reversed. This fact sheet follows trends in retirement account balances since the beginning of 2005.

Suppose that a taxpayer earns an additional dollar of income. How much tax would she owe on that dollar? A natural way to answer this question would be to look up the taxpayer’s statutory tax rate - the tax rate corresponding to her tax bracket and filing status.