Statutory Individual Income Tax Rates and Other Elements of the Tax System: 1988 through 2008

Statutory Individual Income Tax Rates and Other
Elements of the Tax System: 1988 through 2009
Updated October 22, 2008
Maxim Shvedov
Analyst in Public Sector Economics
Government and Finance Division

Statutory Individual Income Tax Rates and Other
Elements of the Tax System: 1988 through 2009
Summary
Statutory individual income tax rates, also referred to as “statutory marginal tax
rates,” are the rates of tax applicable to the last (marginal) increment of taxable
income. Statutory rates play an important role in determining the effective (or real,
depending on the naming convention) marginal tax rates, which affect taxpayers’
economic behavior.
Developments since enactment of the Tax Reform Act of 1986 (TRA86; P.L.
99-514) are the most relevant to the current state of affairs. Since then, the Omnibus
Budget Reconciliation Act of 1990 (OBRA90; P.L. 101-508), the Omnibus Budget
Reconciliation Act of 1993 (OBRA93; P.L. 103-66), and the Economic Growth and
Tax Relief Reconciliation Act of 2001 (EGTRRA; P.L. 107-16) and its extensions
all changed the marginal income tax rate structure. Under current law, upon
expiration of tax cuts enacted in 2001 through 2008, the rate structure will revert in

2011 to the one set by OBRA93.

The six marginal income tax rates for 2009 are 10%, 15%, 25%, 28%, 33%, and
35%. Specific types of income, such as capital gains, may be subject to different sets
of marginal tax rates. The alternative minimum tax system (AMT), a parallel tax
system which has recently garnered considerable attention, also has a different set of
parameters.
Since 1981, Congress established and expanded, with slight modifications, the
policy of tax indexation. Tax indexation helps prevent automatic tax increases and
unintended changes in the distribution of the tax burden due to inflation. Under
current law, many key components of the tax structure are indexed for inflation.
Such components include the tax rate brackets, the personal exemptions and their
phase-out thresholds, standard deductions, the itemized deduction limitation
threshold, and others. Not all elements of the tax system, however, are currently
adjusted for inflation. One of the examples is the AMT.
This report summarizes information about the tax brackets and other key
elements of the tax system that determine taxpayers’ statutory marginal tax rates.
Such elements include tax brackets, exemptions, standard deductions, etc. This
report, originally written by Gregg A. Esenwein, now retired, is updated annually to
reflect the most recent indexation adjustments and statutory changes.

Contents
Various Concepts of Tax Rates and Distinctions Among Them..............1
Major Legislation Affecting the Statutory Rates..........................2
Tax Reform Act of 1986........................................3
Omnibus Budget Reconciliation Act of 1990........................4
Omnibus Budget Reconciliation Act of 1993........................5
Economic Growth and Tax Relief Reconciliation Act of 2001...........6
Jobs and Growth Tax Relief Reconciliation Act of 2003
and the Working Families Tax Relief Act of 2004................7
Effects of Inflation on Income Tax Liabilities............................9
The Mechanics of Indexation........................................12
Tax Rate Schedules for 1988 Through 2009............................13
List of Tables
Table 1. Phase-in and Expiration of Select Provisions
Under EGTRRA and Subsequent Legislation........................8
Table 2. Indexed Elements of the Individual Income Tax System...........11
Table 3. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1988...................................14
Table 4. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1989...................................15
Table 5. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1990...................................16
Table 6. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1991..................................17
Table 7. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1992..................................18
Table 8. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1993..................................19
Table 9. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1994..................................20
Table 10. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1995...................................21
Table 11. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1996...................................22
Table 12. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1997...................................23
Table 13. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1998...................................24
Table 14. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 1999...................................25

and Statutory Tax Rates, 2000...................................26
Table 16. Personal Exemptions, Standard Deductions,
and Statutory Tax Rates, 2001...................................27
Table 17. Personal Exemptions and Standard Deductions, 2002............28
Table 18. Statutory Marginal Tax Rates, 2002..........................29
Table 19. Statutory Marginal Tax Rates, 2003 Under Prior Law............30
Table 20. Personal Exemptions and Standard Deductions, Limitation
on Itemized Deductions, and the Personal Exemption Phase-out, 2003...31
Table 21. Statutory Marginal Income Tax Rates, 2003...................32
Table 22. Personal Exemptions and Standard Deductions, Limitation
on Itemized Deductions, and the Personal Exemption Phase-out, 2004...33
Table 23. Statutory Marginal Income Tax Rates, 2004...................34
Table 24. Personal Exemptions, Standard Deductions,
Limitation on Itemized Deductions and the
Personal Exemption Phase-out Thresholds, 2005....................35
Table 25. Statutory Marginal Income Tax Rates, 2005...................36
Table 26. Personal Exemptions, Standard Deductions,
Limitation on Itemized Deductions and the
Personal Exemption Phase-out Thresholds, 2006....................37
Table 27. Statutory Marginal Income Tax Rates, 2006...................38
Table 28. Personal Exemptions, Standard Deductions,
Limitation on Itemized Deductions and the
Personal Exemption Phase-out Thresholds, 2007....................39
Table 29. Statutory Marginal Income Tax Rates, 2007...................40
Table 30. Personal Exemptions, Standard Deductions,
Limitation on Itemized Deductions and the
Personal Exemption Phase-out Thresholds, 2008....................41
Table 31. Statutory Marginal Income Tax Rates, 2008...................42
Table 32. Personal Exemptions, Standard Deductions,
Limitation on Itemized Deductions and the
Personal Exemption Phase-out Thresholds, 2009....................43
Table 33. Statutory Marginal Income Tax Rates, 2009...................44

Statutory Individual Income Tax Rates and
Other Elements of the Tax System: 1988
through 2009
Various Concepts of Tax Rates and
Distinctions Among Them
Statutory individual income tax rates, also referred to as “statutory marginal tax
rates,” are the rates of tax prescribed by law that are applicable to the last (marginal)
increment of taxable income. For many policymakers and taxpayers the level of
statutory marginal tax rates is one of the most conspicuous features of the tax system.
It is important to distinguish between real (or, effective) and statutory rates.
While they sound confusingly similar, each designates a very different economic
concept. Statutory rates are simply the tax rates written into law for specified tiers
of taxable income. Real marginal tax rates are the rates that actually apply to the last
(marginal) increment of income.
Real and statutory marginal tax rates may diverge considerably for some
taxpayers, but in many cases they do coincide and in many others they are¹
interconnected. For example, some taxpayers facing 10% statutory rate, were
subject to real marginal rate in excess of 31%. At the same time, “most taxpayers²
face effective marginal rates of 15 percent or less,” often coinciding or nearly-
coinciding with the statutory rate. Some of the elements of the tax system that give
rise to the difference between the real and statutory rates include the earned income
tax credit (EITC) phase-ins and phase-outs,³ the alternative minimum tax (AMT),⁴⁵
the phase-outs of personal exemptions and deductions, and other provisions.

¹ For more information, see U.S. Congressional Budget Office, Effective Marginal Tax Rates
on Labor Income, Nov. 2005, available at [http://cbo.gov/ftpdocs/68xx/doc6854/

11-10-LaborT a xation.pdf].

² Ibid., p. 1.
³ For more information see CRS Report RL31768, The Earned Income Tax Credit (EITC):
An Overview, by Christine Scott.
⁴ For more information see CRS Report RL30149, The Alternative Minimum Tax for
Individuals, by Steven Maguire.
⁵ For more details see CRS Report RS22464, The PEP and Pease Provisions of the Federal
Individual Income Tax, by Gregg A. Esenwein.

Economists believe that taxpayers change their behavior in response to effective
(real), not statutory, marginal tax rates. It means that when deciding, say, whether
to work more, taxpayers consider by how much their real after-tax income would
actually change as a result of this decision. The concept may be extended beyond
individual income tax to an overall tax, or even overall fiscal, system, which includes
other federal and sub-federal taxes and payments.⁶ This broader analysis, however,
goes beyond the scope of this report.
In contrast, average tax rates describe the total tax burden, but do not directly
affect individuals’ economic decision-making. Average tax rates express total tax
liability as a percentage of income. Unlike”marginal” variables, they do not reflect
how a taxpayer’s economic position change in response to his or her actions.
Major Legislation Affecting the Statutory Rates
Over the past decades, there have been several major changes in federal
individual statutory marginal income tax rates. The Tax Reform Act of 1986
(TRA86; P.L. 99-514) is a starting point from which the modern tax structure
evolved. TRA86, among other things, created a tax rate structure that consisted of
just two statutory individual income tax rates: 15% and 28%. However, TRA86 also
legislated a 5% surcharge on the taxable income of certain upper-income households,
which effectively created a third marginal tax rate of 33%.
The Omnibus Budget Reconciliation Act of 1990 (OBRA90; P.L. 101-508)
eliminated the 5-percent surcharge and created a marginal tax rate structure
consisting of three statutory marginal tax rates of 15%, 28%, and 31%. However,
OBRA90 also contained a provision limiting the amount of itemized deductions that
upper-income households could claim and a provision modifying the phase-out of the
tax benefits of personal exemptions for upper-income households. These provisions
increased effective marginal tax rates over the statutory marginal tax rates for
affected taxpayers.
The Omnibus Budget Reconciliation Act of 1993 (OBRA93; P.L. 103-66) added
two new marginal income tax brackets, at 36% and 39.6% rates, at the upper end of
the income scale. It also delayed indexation of the two new tax brackets for one year.
In addition, OBRA93 made permanent the limitation on itemized deductions and the
phase-out of the personal exemption.
The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA;
P.L. 107-16) created a new 10% marginal income tax bracket. It also reduced the top
four marginal tax rates to 25%, 28%, 33%, and 35% with the changes phased-in over
the period 2001 through 2006. Additional provisions of the act affected tax brackets
and limitations on personal exemptions and deductions for higher income taxpayers.
The Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA; P.L.

⁶ For an example of such analysis, see S. D. Holt and J. L. Romich, (2007), Marginal Tax
Rates Facing Low- and Moderate-Income Workers Who Participate in Means-Tested
Transfer Programs, National Tax Journal, vol. 60, no. 2, June 2007, p. 253.

108-27), and the Working Families Tax Relief Act of 2004 (WFTRA; P.L. 108-311)

accelerated and extended the tax rate reductions originally enacted under EGTRRA.⁷
Under current law, however, most of these changes are scheduled to expire at the end
of 2010.
The following sections of this report describe each of these major acts in more
detail.
Tax Reform Act of 1986
Among its many changes, the Tax Reform Act of 1986 (TRA86; P.L. 99-514)
instituted a rather simple marginal tax rate structure for tax years after 1987. It
consisted of two statutory tax rates: 15% and 28%. Table 3 shows the elements of
the 1988 tax structure. These rates applied to capital income as well as to labor
income. By comparison, in 1986, there had been 14 non-zero marginal tax brackets⁸
and the top statutory marginal tax rate reached 50%.
Although the TRA86 specified that there were only two statutory individual
marginal income tax rates, it also adopted a 5% surcharge on the taxable income of
certain upper-income households. This surcharge effectively created a third marginal
tax rate of 33% (28% statutory marginal tax rate plus 5% surcharge).
Because the surcharge was first phased in and then phased out as incomes
increased, marginal tax rates rose to 33% but then fell back to 28%, producing what
came to be known as the tax rate “bubble.” The surcharge was adopted so that the
TRA86 would not change the distribution of the income tax burden relative to its
distribution under pre-1986 tax law and would meet the revenue targets. The
surcharge allowed for characterization of the TRA86 as having only two statutory
marginal tax rates, while meeting these other goals.
The surcharge was designed to eliminate the tax benefits of the 15% tax bracket
and the tax benefits of the personal exemptions for upper-income households. For
joint returns in 1988, the phase-out of the 15% tax rate started when taxable income
exceeded $71,900 and ended when taxable income reached $149,250, and the phase-
out of the exemptions followed from that point on. For single returns, the phase-out
of the 15% tax bracket occurred over the taxable income range of $47,050 to
$97,620. For heads of households, the phase-out occurred over the taxable income
range of $67,200 to $134,930. The phase-out of the exemptions followed the phase-
out of the 15% tax bracket for all filing statuses, but the range of income over which
it occurred depended on the number of exemptions claimed by a taxpayer.
To demonstrate how the 5% surcharge worked to “phase out” the tax benefits
of the 15% tax bracket consider the following example based on joint returns for

⁷ For more details see CRS Report RL34425, Expiration and Extension of the Individual
Income Tax Cuts Enacted in 2001 Through 2007, by Maxim Shvedov.
⁸ For historical rates and brackets in 1986 and other years see Tax Policy Center, Tax Facts,
Individual Income Tax Brackets, 1945-2008, Excel file, at
[http://taxpolicycenter.org/taxfacts/Content/Excel/indivi dual_rates.xls].

1988. The difference between taxing the first $29,750 of taxable income at 28%

instead of 15% was $3,867.50 (obtained as $29,750 multiplied by 13%, the
difference between 28% and 15%). Five percent of the difference between the upper
and lower phase-out limits was also $3,867.50 ($149,250 less $71,900 multiplied by
5%). Hence, assessing the 5% surcharge on taxable income between $78,400 and
$162,770 was equivalent to having taxed the first $32,450 of taxable income at 28%
rather than 15%.
A 5% surcharge was also used to phase out the tax benefits of the personal
exemption for upper-income households. In 1988, each personal exemption was
worth $1,950 and produced a tax savings for a household in the 28% marginal tax
rate bracket of $546 ($1,950 times 28%). To recapture this tax savings a 5%
surcharge was assessed against $10,920 of taxable income for each personal
exemption claimed. A 5% surcharge against this amount of taxable income increased
tax liability by $546 ($10,920 times 5%), which exactly offset the tax savings from
the personal exemption.
The phase-out of personal exemptions started immediately after the phase-out
of the 15% tax bracket and the phase-out of each exemption occurred sequentially.
This meant that the taxable income range over which the 5% surcharge offset
personal exemptions depended on the number of personal exemptions claimed on the
tax return. For example, on a joint return claiming two personal exemptions, the 5%
surcharge would apply to taxable income between $149,250 and $171,090 ($149,250
plus two times $10,920). On a joint return with four personal exemptions, the 5%
surcharge would apply to taxable income between $149,250 and $192,930 ($149,250
plus four times $10,920).
Omnibus Budget Reconciliation Act of 1990
The Omnibus Budget Reconciliation Act of 1990 (OBRA90; P.L. 101-508)
created a three-tiered statutory marginal income tax rate structure with rates of 15%,

28%, and 31%, effective in tax years beginning in 1991, as shown in Table 5.

OBRA90 eliminated the tax bubble created under TRA86, but replaced it with a
limitation on itemized deductions and a new approach to phasing out the tax benefits
of the personal exemption for upper-income households.
OBRA90 reintroduced a tax-rate differential on capital gains income. OBRA90
contained a provision which limited the tax on capital gains income to a maximum
of 28%. This provision was effective starting in tax year 1991. Under TRA86,
capital gains had been treated as ordinary income and taxed at regular rates of up to

33%.

The OBRA90 limitation on itemized deductions worked as follows. For tax
years starting in 1991, otherwise allowable deductions were reduced by 3% of the
amount by which a taxpayer’s adjusted gross income (AGI) exceeded $100,000 (or
$50,000 in the case of married couples filing separate returns). For example, in 1991,
if a taxpayer’s AGI was $110,000, then his otherwise allowable itemized deductions
would be reduced by $300 ($110,000 less $100,000 times 3%). This provision
effectively raised the marginal income tax rate of those taxpayers affected by
approximately one percentage point. A dollar of income in excess of $100,000 was

taxed as if it were $1.03, since in addition to the tax on an extra dollar of income, the
taxpayer lost tax deductions by giving up $0.03 of itemized deductions.
This limitation was scheduled to expire after tax year 1995 under OBRA90, but
was later extended. Allowable deductions for medical expenses, casualty and theft
losses, and investment interest were not subject to this limitation. For tax years after

1991, the $100,000 threshold was indexed for inflation.

The phase-out of the tax benefits of the personal exemption worked as follows.
Each personal exemption was phased out by a factor of 2% for each $2,500 (or
fraction thereof) by which a taxpayer’s AGI exceeded a given threshold amount. In
1991, the threshold amount for a joint return was $150,000; for a single return the
threshold was $100,000; and for heads of households the threshold was $125,000.
For example, in 1991, a joint household whose AGI was $183,000 would lose
28% of their total personal exemptions claimed. The AGI amount in excess of the
threshold in this instance would be $33,000, $183,000 AGI less $150,000 threshold
limit. The $33,000 excess divided by $2,500 would produce a factor of 13.2 which
when rounded up would equal 14. This figure is multiplied by 2% to arrive at the
final disallowance amount of 28%. Hence, if the family had claimed two personal
exemptions, which at $2,150 each would total $4,300, they would only be allowed
to deduct $3,096 ($4,300 total personal exemptions less the $1,204 disallowance,
which is 28% of the total).
For tax years after 1991, these income threshold amounts were indexed for
inflation. The personal exemptions phase-out provision was also scheduled to expire
after tax year 1995.
Omnibus Budget Reconciliation Act of 1993
The Omnibus Budget Reconciliation Act of 1993 (OBRA93; P.L. 103-66) made
several changes in the individual marginal income tax rate structure. First, it added
two new marginal tax rates, 36% and 39.6%, at the upper end of the income
spectrum. The 39.6% marginal tax rate bracket was created by imposing a “10%
surtax” on high-income taxpayers (39.6=36 + 3.6, which is 10% of 36).
Although OBRA93 was enacted in August of 1993, the increase in the top
marginal tax rates was made effective retroactively to January 1, 1993. Affected
taxpayers, however, were not assessed penalties for underpayment of 1993 taxes
resulting from the tax rate increase. Taxpayers were also allowed to pay any
additional 1993 taxes in three equal installments over a two-year period.
Second, OBRA93 delayed indexation of the new top marginal income tax
brackets for one year. Hence, the nominal dollar tax brackets for the 36% and 39.6%
marginal tax rates remained at the same level for both tax years 1993 and 1994.
Finally, OBRA93 made permanent both the itemized deduction limitation and
the phase-out of the tax benefits from personal exemptions.

Economic Growth and Tax Relief Reconciliation Act of 2001
The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA;
P.L. 107-16) made several major changes to the marginal tax rate structure. Many
of the act’s provisions were set to phase-in over a period of time, but subsequent
2003 and 2004 legislation, described in the next section, overrode the schedule
originally set by EGTRRA. Table 1 shows the time line of changes related to the
marginal tax rate structure enacted under EGTRRA and subsequent bills, discussed
below.
First, the 2001 Act created a new 10% bracket. It applied, beginning in tax year
2002, to the first $12,000 of taxable income for married couples filing jointly, the
first $10,000 of taxable income for heads of households, and the first $6,000 of
taxable income for single individuals. For tax year 2001, the act created a “rate
reduction tax credit,” mimicking the effects of the 10% tax rate bracket for most⁹
taxpayers.
In tax years 2003-2007, these provisions of EGTRRA were superseded by
subsequent legislation. In 2008, EGTRRA set the 10% marginal tax rate bracket at
$7,000 and $14,000 for single and married taxpayers, respectively. Starting with tax
year 2009, these bracket amounts are scheduled to be indexed for inflation.
Second, the 2001 Act gradually reduced the top four marginal income tax rates.
Under prior income tax law, the top four marginal tax rates were 28%, 31%, 36% and
39.6%. When fully phased in, the 2001 Act reduced the top four marginal income
tax rates to 25%, 28%, 33% and 35%. Under EGTRRA the reductions were
scheduled to take place in 2001 through 2006, but subsequent legislation accelerated
the EGTRRA phase-in schedule.
Third, EGTRRA also repealed the limitation on itemized deductions and
personal exemptions for high-income taxpayers. The repeal was scheduled to be
phased in between 2006 and 2009. The limitation was completely repealed for 2010,
but it would reappear again in 2011, once the EGTRRA’s tax cuts expire.
Fourth, some of the act’s measures designed to reduce the marriage penalty
affected the rate bracket structure. The act increased the width of the 15% tax
bracket for married couples filing joint returns to twice the width of the 15% tax
bracket for single returns. Under EGTRRA this provision was scheduled for phase-
in over a four-year time period starting in 2005, but subsequent legislation
accelerated this time line. Under EGTRRA, the end point of the 15% tax bracket for
joint returns was scheduled to be 180% of the end point of the 15% tax bracket for
single returns in 2005, 187% in 2006, 193% in 2007, and 200% in 2008 and
subsequent years.¹⁰

⁹ For more information see CRS Report RS21171, The Rate Reduction Tax Credit — ‘The
Tax Rebate’ — in the Economic Growth and Tax Relief Reconciliation Act of 2001: A Brief
Explanation, by Steven Maguire.
¹⁰ For more information on these changes see CRS Report RL34425, Expiration and
(continued...)

Finally, the 2001 Act increased the standard deduction for joint returns to twice
the size of the standard deduction for single returns. The change was scheduled to
be phased in over a five-year period, 2005 to 2009, but it was accelerated by the
subsequent bills as well. This had an effect, as far as tax rate brackets were
concerned, of raising the lower threshold of the lowest tax bracket for married
taxpayers filing joint returns.
Jobs and Growth Tax Relief Reconciliation Act of 2003 and
the Working Families Tax Relief Act of 2004
Among the several acts extending provisions in EGTRRA, the Jobs and Growth
Tax Relief Reconciliation Act of 2003 (JGTRRA; P.L. 108-27) and the Working
Families Tax Relief Act of 2004 (WFTRA; P.L. 108-311) directly affected statutory
income tax rates.
JGTRRA accelerated several changes to the individual income tax rate structure
first enacted under EGTRRA. It moved forward to 2003 the tax rate reductions,
expansion in the 10% tax bracket, and widening of the 15% tax bracket for joint
returns to twice the width of the 15% tax bracket for single returns. Under EGTRRA
some of these changes would not have been fully phased in until 2009.
WFTRA extended several tax provisions of the JGTRRA that were scheduled
to expire at the end of 2004. Among other things, the WFTRA extended the increase
in the 10% income tax bracket through 2007, at which point EGTRRA’s relevant
provisions were fully phased in, maintaining a constant level of the tax relief.
The 2004 act also extended marriage penalty relief through 2008. The standard
deduction and 15% tax bracket for joint returns were set at twice their level for single
returns. In 2009 and 2010, EGTRRA provisions apply, maintaining the same level
of tax relief.
Both acts also established a more preferential treatment of long-term capital
gains and dividends. They reduced the tax rates applicable to these kinds of income
to 15%, or even 0% for certain taxpayers.

¹⁰ (...continued)
Extension of the Individual Income Tax Cuts Enacted in 2001 Through 2007, by Maxim
Shvedov.

CRS-8
Table 1. Phase-in and Expiration of Select Provisions Under EGTRRA and Subsequent Legislation
^Provi^sⁱ^on²⁰⁰¹²⁰⁰²²⁰⁰³²⁰⁰⁴²⁰⁰⁵²⁰⁰⁶²⁰⁰⁷²⁰⁰⁸²⁰⁰⁹²⁰¹⁰²⁰¹¹
^T^a^x^Rates^an^d^Brack^e^ts
^EG^T^R^R^A^:^{$12,000 /}^JG^T^R^R^A^:^{$14,000 /}^WF^T^R^A^:^{$14,000 /}^{$7,000 f}^o^{r cou}^p^l^e^s^EG^T^R^R^A^:^{$14,000 /}^{$7,000 f}^o^r^B^r^ack^et
^c^k^e^t^{$6,000 brack}^et^s^f^o^r^c^o^up^l^e^{s /}^si^ngl^e^s^.^{$7,000 f}^o^{r cou}^p^l^e^s^/^sⁱⁿ^g^l^es^{. In}^dexⁱⁿ^2004.^/^si^ngl^e^s^.^cou^p^l^e^s^/^sⁱⁿ^g^l^es^{. In}^dexⁱⁿ^2009.^ex^pires^.
^E^G^T^RRA^:^E^G^T^RRA^:^J^G^T^RRA^:^E^G^T^RRA^:^R^e^v^e^r^{ts to}^:
^39.1%^38.6%^35%^35%^39.6%
^rates^{in top}^35.5%^35%^33%^33%^36%
^a^{x bra}^c^k^e^t^s
^30.5%^30%^28%^28%^31%
ⁱ^{ki/CRS-RL34498}^27.5%^27%^25%^25%^28%
^g/w
^s^.or^rates^on^JG^T^R^R^A^:^U^p^t^o^20%
^le^akⁱ^tal^gaiⁿ^s^an^d^N^o^ch^an^g^e^.^J^G^T^R^R^A^:^15%^{or 5%}^rat^e^depen^dⁱⁿ^g^onⁱⁿ^com^e^.^15%^/^0%^T^I^PR^A^:^15%^/^0%^o^r^r^e^gul^a^r
ⁱ^dends^tax^r^a^tes.
^://wiki^Lⁱ^mⁱ^ts^{on I}^t^em^{ized Deducti}^on^s^an^d^Pers^on^al^E^x^em^p^tⁱ^oⁿ^s
^h^ttp
^r^elim^ina^t^e^E^G^T^RRA^:
^it^{s o}ⁿ^it^em^ized^{No ch}^an^g^e^.^EGT^RRA^{: Red}^u^{ce lim}^its^EGT^R^RA^{: Red}^u^{ce lim}^its^R^e^peal^Lⁱ^m^its
ⁱ^oⁿ^{s a}^{nd perso}ⁿ^a^l^by^on^e-^t^hⁱ^r^d.^b^y^tw^o^-^th^ir^d^s^.^lim^its.^rein^s^t^ated.
^ptions
^M^a^rri^{age Pen}^a^l^t^{y R}^e^lⁱ^e^f
^e^s^t^andard^J^G^T^R^RA^{: Ded}^u^ctioⁿ^f^o^r^WF^T^R^A^:^D^e^du^ctⁱ^oⁿ^f^o^{r cou}^p^l^e^sⁱ^s^200%^of^t^h^e^EGT^R^RA^{: Ded}^u^ctioⁿ^f^o^r^Re^ve^r^t^{s to}
^a^rried^{No ch}^an^g^e^.^cou^p^l^e^sⁱ^s^200%^of^t^h^e^d^e^d^u^c^tⁱ^o^{n fo}^r^si^ngl^e^s^.^cou^p^l^e^sⁱ^s^200%^of^t^h^e^167%^.
^d^e^d^u^c^tⁱ^o^{n fo}^r^si^ngl^e^s^.^d^e^d^u^c^tⁱ^o^{n fo}^r^si^ngl^e^s^.
^{pand 15 percent}^JG^T^R^R^A^:^T^{op of}^t^h^e^WF^T^R^A^:^T^{op of}^t^h^{e brack}^et^f^o^r^EG^T^R^R^A^:^T^{op of}^t^h^{e brack}^et^f^o^r^Re^ve^r^t^{s to}
^e^{t for m}^a^rried^{No ch}^an^g^e^.^brack^{et f}^o^{r cou}^p^les^is^cou^p^l^e^sⁱ^s^200%^of^t^h^at^f^o^{r s}ⁱⁿ^g^l^es^.^cou^p^l^e^sⁱ^s^200%^of^t^h^at^f^o^{r s}ⁱⁿ^g^l^es^.^167%^.
^200%^of^t^h^at^f^o^{r s}ⁱⁿ^g^l^es^.
^C^R^S^adaptation^of^C^oⁿ^g^r^es^sⁱ^on^{al B}^u^dg^{et Of}^fⁱ^{ce an}^d^J^oⁱⁿ^{t Co}^m^m^{ittee o}ⁿ^T^a^x^a^tioⁿ^tab^l^{es an}^d^p^u^b^licatioⁿ^s^.
^:^EGT^R^R^A^{— Econ}^om^{ic Grow}^th^an^{d T}^a^x^R^e^lief^R^econ^c^iliation^A^c^{t of}^{2001 (P}^.L^{. 107-}^{16, 2001, in}^trodu^{ced as}^H.R^.^1836);^J^G^T^R^R^A^—^J^o^b^s^an^d^Gr^o^w^th^T^a^x^Relief^Recoⁿ^c^iliatioⁿ
^{2003 (P}^.L^{. 108-}^{27, 2003, in}^trodu^{ced as}^H.R^.^{2); W}^F^T^R^A^{— W}^o^rkⁱⁿ^g^Fam^ilies^T^a^x^R^e^lief^A^c^t^of²⁰⁰⁴^(P^.L^.^108-^{311, 2004, in}^t^rodu^{ced as}^H^.^R^.^1308);^T^I^PR^A^—^T^a^x^In^creas^e
^en^tion^an^{d R}^econ^c^iliation^A^c^{t of}^{2005 (P}^.L^{. 109-}^{222, 2006, in}^trodu^{ced as}^H.R^.^4297).

Effects of Inflation on Income Tax Liabilities
During periods of inflation, a progressive tax structure designated on a nominal-
dollar basis produces automatic tax increases and unintended changes in the
distribution of the tax burden. It occurs, because nominal incomes rise faster than the
real incomes, leading to a heavier tax burden imposed on taxpayers compared to what
lawmakers intended at the time of their policy considerations.
The federal individual income tax system in the United States is progressive.
That is, as incomes rise, income tax liabilities as a share of income also rise. In
addition, the income tax is calculated on the basis of current dollar amounts. Absent
periodic indexation of the tax system elements, a larger share of taxpayers would be
subject to higher tax liabilities, simply because their nominal income increased,
regardless of how their real income had changed.
The effects of inflation on income tax liabilities could be substantial even in
periods of low inflation, such as the last two decades. Still, according to the Bureau
of Labor Statistics, $1,000 in 1989 is worth about $1,707, or almost 71% more, in
2008.¹¹ Year-to-year changes might appear negligible, but over a period of several
years, it compounds to make a substantial difference.
Consider a hypothetical example of what lack of indexation would have implied
for a taxpayer, if the 1989 tax structure applied without indexation in 2008. For
illustration consider a four-person family with adjusted gross income (AGI) of
$35,000 in 1989, a rounded up 1989 family median income of $34,213, according to¹²
the Census. If we assume that the family used the standard deduction, then its
taxable income would have been $21,800 ($35,000 less standard deduction of $5,200
and four personal exemptions at $2,000 apiece), and the tax liability — $3,270. This
translates into an after-tax income of $31,730 ($35,000 less $3,270), or an average
tax rate of 9.3% ($3,270 divided by $35,000 income).
Now consider what would have happened in 2008 if this family’s nominal
income just kept up with inflation. The AGI would have been approximately
$60,000. If the tax structure were not indexed for inflation, the family’s taxable
income would have been $46,800. The tax liability would have increased to
approximately $9,081 in current 2008 dollars, or $5,319 in constant 1989 dollars
($9,081 adjusted for cumulative inflation of about 71%). This would represent a tax
liability increase of 63% in real terms. The family’s after-tax income would be
$50,919 in current 2008 dollars, or $29,826 in constant 1989 dollars ($50,919
adjusted for the cumulative inflation of about 71%), a decrease of 6%. Its average
tax rate would have increased from 9.3% to 15.1%.

¹¹ BLS, CPI Inflation Calculator, web page, at [http://data.bls.gov/cgi-bin/cpicalc.pl].
¹² U.S. Census, Historical Income Tables — Families, Table F-5. Race and Hispanic Origin
of Householder — Families by Median and Mean Income: 1947 to 2005, web page, at
[ h t t p : / / www.census.go v/ hhes/ www/ i n come / h i s t i n c/ f 05.ht ml ] .

This example illustrates how this family’s real after-tax income declined by 6%,
because of the so-called, “bracket creep.” Its income tax burden increased by 63%
in real terms between 1989 and 2008. This effect would be even more pronounced
in the periods of a high inflation.
Under an indexed tax system, the family would have experienced no change in
their real after-tax income. For instance, under an indexed system the value of the
standard deduction for a joint return would have increased from $5,200 in 1989 to
$8,877 in 2008. The personal exemption would have increased from $2,000 to
$3,414. Under these circumstances the family’s 2008 taxable income would have
been $37,465 ($60,000 income less standard deduction and personal exemptions).
Tax brackets would have adjusted as well. Based on this taxable income and the
adjusted brackets, their income tax liability would have been $5,620 in current 2008
dollars, or $3,291 in constant 1989 dollars — about the same as in 1989 (the
difference is due to rounding). In short, the nominal amounts might be different, but
real values would have stayed the same for this family.
Congress enacted income tax indexation as a part of an overall package of
statutory marginal tax rate reductions contained in the Economic Recovery Tax Act
of l981.
The Congress believed that “automatic” tax increases resulting from the effects
of inflation were unfair to taxpayers, since their tax burden as a percentage of
income could increase during intervals between tax reduction legislation, with
an adverse effect on incentives to work and invest. In addition, the Federal
Government was provided with an automatic increase in its aggregate revenue,¹³
which in turn created pressure for further spending.
There was very little debate about this aspect of the bill. The act specified
which elements of the tax system were subject to indexation. Over the years, as the
tax system changed, additional elements entered the list.
The list of the indexed elements of the tax system has been gradually expanding
over the years. For example, one of the most notable changes occurred with the
passage of the TRA86, which extended indexation to some of the newly created
elements of the tax system, such as the additional standard deductions for the elderly
and the blind, the EITC, and others. More recently, EGTRRA applied indexing to
the EITC phase-out amounts in 2008.
Table 2 lists major indexed tax items and provides the year of the first
adjustment.¹⁴ For some provisions the technicalities are too complex to be listed in
a table format. For example, as mentioned above, indexing of some elements of the
EITC started in 2008, while others have been indexed since the late 1980s.

¹³ U.S. Congress, Joint Committee on Taxation, General Explanation of the Economic
Recovery Tax Act of 1981, JCS-71-81, Dec. 31, 1981, as redistributed by CCH Internet Tax
Research NetWork.
¹⁴ James C. Young, “A Summary of 2007 Inflation Adjustments Impacting Individuals,” Tax
Notes, Oct. 15, 2007, p. 246.

Table 2. Indexed Elements of the Individual Income Tax System
Base PeriodAdjustment
Is the 12-First Occurs
Item Monthin Calendar
PeriodYear
Ending
Standard deduction 31-Aug-871989
Unearned income of minor child (base amount)31-Aug-871989
Exemptions 31-Aug-881990
Educational savings bonds 31-Aug-891991
Exemption phase-out 31-Aug-901992
Itemized deduction limitation (3% of AGI) 31-Aug-901992
Tax rate schedules:
10% bracket 31-Aug-022004
15%/25%/28% brackets 31-Aug-921994
33%/35% brackets 31-Aug-931995
Earned income credit 31-Aug-951997
Standard deduction for employed dependents 31-Aug-971999
Medical savings accounts 31-Aug-971999
Annual gift tax exclusion 31-Aug-971999
Qualified transportation fringe benefits:
Categories 1 and 2 31-Aug-012003
Category 3 31-Aug-982000
HOPE, lifetime learning, and child tax credits 31-Aug-002002
Education loan interest 31-Aug-012003
Adoption expenses/credit 31-Aug-012003
Traditional and Roth IRA income phase-outs 31-Aug-052007
Section 179 expense amounts 31-Aug-062008
^Source:^J^a^m^e^{s C.}^Y^o^ung,^“A^Sum^m^a^r^y^o^f^{2007 In}^f^l^atⁱ^oⁿ^A^d^j^u^s^t^m^eⁿ^t^s^Im^pactⁱⁿ^g^In^di^vⁱ^du^al^s^.^”
Indexing might make the tax system somewhat more technically complex, but
this is a minor complication. The year-to-year changes in dollar amounts are usually
small, so taxpayers hardly ever face unexpected changes that might materially affect
them. On the revenue side, indexing results in lower government receipts.
Some elements of the tax system are not adjusted for inflation or are only
partially adjusted. For example, most of the amounts related to the child tax credit
are not adjusted for inflation, including the amount of the credit itself or phase-out
thresholds for higher-income taxpayers. The earned income floor used in calculating
the credit’s refundable amount is adjusted for inflation, however.¹⁵
In recent years, a problem caused by the lack of indexation of the alternative
minimum tax (AMT) parameters has garnered considerable attention of the
policymakers and the public, because of the fast-growing number of taxpayers that
could be affected by the AMT. The AMT is an alternative income tax system,
originally intended to affect only high-income taxpayers. AMT’s parameters are not

¹⁵ In 2008 the amount of the threshold was set by a special provision of the Emergency
Economic Stabilization Act of 2008 (P.L. 110-343), but this provision is effective only for
a single year.

adjusted for inflation. With the passage of time, as nominal incomes of taxpayers
rose across the board, the AMT affected a larger number of taxpayers at a broader
range of income levels. It is estimated that, absent congressional action, the number
of taxpayers subject to the AMT will increase from over 1 million in 2001 to about
26 million in 2008, and almost 36 million in 2017.¹⁶ In recent years, Congress has
adjusted AMT parameters to avoid this in a series of one-year adjustments, but at this
point it is not clear how this ongoing issue will be resolved in the long term.¹⁷
While the AMT is currently the most notable problem caused by the lack of
indexation, the AMT exemptions are not the only parameters in the tax system not
adjusted for inflation. Therefore it is conceivable that lack of indexation may pose
new complications in other areas of the tax system in the future.
The Mechanics of Indexation
Most provisions are indexed using the technical calculation described below.
The methodology is the same, although specific parameters may vary by provision.
In some instances, the calculation methodology differs somewhat in one way or
another. Such examples include the EITC or transportation benefits. The variations
are insignificant from an economic standpoint, as long as they do not result in
systematic deviations from the rate of inflation.
The adjustment for any given tax year is based on the percentage amount by
which the average Consumer Price Index for all urban consumers (CPI-U) for the 12-
month period ending on August 31 of the preceding year exceeds the average CPI-U
during a specified twelve month base period. The base period differs depending
upon the tax component under consideration, as listed in Table 2.
With the exception of the EITC and some other instances, inflation adjustments
are currently rounded down to the nearest multiple of $50. Although rounding down
affects the accuracy of any given year’s inflation adjustment, the effect is not
cumulative since each year’s adjustment is calculated to reflect the entire amount of
inflation that has occurred between the adjustment year and the base period.
For example, the adjustment factor for the standard deductions in 2008 was
calculated as follows. The average CPI-U for the base period, September 1987
through August 1988, was 116.62. The average CPI-U for the period September
2006 through August 2007 was 204.87. Given these amounts, the inflation
adjustment factor for 2008 was 1.76 (204.87/116.62).

¹⁶ U.S. Congress, Joint Committee on Taxation, Present Law and Background Relating to
the Individual Alternative Minimum Tax, JCX-38-07, June 25, 2007, pp. 11, 17.
¹⁷ For more information please see CRS Report RS21817, The Alternative Minimum Tax
(AMT): Income Entry Points and “Take Back” Effects, by Steven Maguire.

This inflation adjustment factor was then applied to $2,000 — the base year
value of the exemption in 1989 — resulting in $3,513. Rounding this number down
to the nearest multiple of $50 yields the final value of the exemption in 2008: $3,500.
Tax Rate Schedules for 1988 Through 2009
The following tables present the personal exemption amounts, standard
deductions, and the statutory marginal tax rates schedules for each tax year from

1988 through 2009.

Table 3. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1988
Personal Exemptions$1,950
Standard Deductions
Joint$5,000
Single3,000
Head of Household4,400
Additional Standard Deductions for the Elderly and the Blind
Joint $600
Single/Head of Household750
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $29,75015% of the amount over $0
$29,750 - $71,900$4,462.50 + 28% of the amount over $29,750
$71,900 - $171,090^a$16,264.50 + 33% of the amount over $71,900
$171,090 and over$47,905.20 + 28% of the amount over $171,090
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $17,85015% of the amount over $0
$17,850 - $43,150$2,677.50 + 28% of the amount over $17,850
$43,150- $100,480^a$9,761.50 + 33% of the amount over $43,150
$100,480 and over$28,134.40 + 28% of the amount over $100,480
Statutory Marginal Income Tax Rates, Heads of Household
If taxable income is:Then, tax is:
$0 - $23,90015% of the amount over $0
$23,900 - $61,650$3,585 + 28% of the amount over $23,900
$61,650 - $145,630^a$14,155 + 33% of the amount over $61,650
$145,630 and over$40,776.40 + 28% of the amount over $145,630
^{a. Im}^plⁱ^cⁱ^t^t^a^x^brack^et^{, g}^eⁿ^e^rat^e^{d by}^t^h^{e “}^t^ax^bu^bbl^{e,” as}^des^c^ri^{bed i}ⁿ^t^e^x^t^{. T}^h^{e brack}^et^’^s^u^{pper bou}ⁿ^d
^depen^d^s^on^th^eⁿ^u^m^{ber of}^ex^em^ption^s^claim^e^{d by}^th^{e tax}^p^ay^{er. T}^h^{e ex}^am^{ple in}^th^is^{table as}^s^u^m^e^s^on^e
^ex^em^ption^f^o^{r s}ⁱⁿ^g^l^{e retu}^rn^s^,^tw^{o f}^o^{r th}^{e oth}^e^{r s}^t^atu^s^es^.

Table 4. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1989
Personal Exemptions$2,000
Standard Deductions
Joint$5,200
Single3,100
Head of Household4,550
Additional Standard Deductions for the Elderly and the Blind
Joint $600
Single/Head of Household750
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $30,95015% of the amount over $0
$30,950 - $ 74,850$4,642.50 + 28% of the amount over $ 30,950
$ 74,850 - $177,720^a$16,934.50 + 33% of the amount over $ 74,850
$177,720 and over$50,881.60 + 28% of the amount over $177,720
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$ 0 - $ 18,55015% of the amount over $0
$ 18,550 - $ 44,900$ 2,782.50 + 28% of the amount over $ 18,550
$ 44,900 - $104,300^a$10,160.50 + 33% of the amount over $ 44,900
$104,300 and over$29,772.40 + 28% of the amount over $104,300
Statutory Marginal Income Tax Rates, Heads of Household
If taxable income is:Then, tax is:
$ 0 - $ 24,85015% of the amount over $0
$ 24,850 - $ 64,200$ 3,727.50 + 28% of the amount over $ 24,850
$ 64,200 - $151,210^a$14,745.50 + 33% of the amount over $ 64,200
$151,210 and over$43,458.80 + 28% of the amount over $151,210
^{a. Im}^plⁱ^cⁱ^t^t^a^x^brack^et^{, g}^eⁿ^e^rat^e^{d by}^t^h^{e “}^t^ax^bu^bbl^{e,” as}^des^c^ri^{bed i}ⁿ^t^e^x^t^{. T}^h^{e brack}^et^’^s^u^{pper bou}ⁿ^d
^depen^d^s^on^th^eⁿ^u^m^{ber of}^ex^em^ption^s^claim^e^{d by}^th^{e tax}^p^ay^{er. T}^h^{e ex}^am^{ple in}^th^is^{table as}^s^u^m^e^s^on^e
^ex^em^ption^f^o^{r s}ⁱⁿ^g^l^{e retu}^rn^s^,^tw^{o f}^o^{r th}^{e oth}^e^{r s}^t^atu^s^es^.

Table 5. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1990
Personal Exemptions$2,050
Standard Deductions
Joint$5,450
Single3,250
Head of Household4,750
Additional Standard Deductions for the Elderly and the Blind
Joint$650
Single/Head of Household800
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$ 0 - $ 32,45015% of the amount over $0
$ 32,450 - $ 78,400$ 4,867.50 + 28% of the amount over $ 32,450
$ 78,400 - $185,730^a$17,733.50 + 33% of the amount over $ 78,400
$185,730 and over$53,152.40 + 28% of the amount over $185,730
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 19,45015% of the amount over $0
$ 19,450 - $ 47,050$ 2,917.50 + 28% of the amount over $ 19,450
$ 47,050 - $109,100^a$10,645.50 + 33% of the amount over $ 47,050
$109,100 and over$31,122.00 + 28% of the amount over $109,100
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 26,05015% of the amount over $0
$ 26,050 - 67,200$ 3,907.50 + 28% of the amount over $ 26,050
$ 67,200 - $157,890^a$15,429.50 + 33% of the amount over $ 67,200
$157,890 and over$45,357.20 + 28% of the amount over $157,890
^{a. Im}^plⁱ^cⁱ^t^t^a^x^brack^et^{, g}^eⁿ^e^rat^e^{d by}^t^h^{e “}^t^ax^bu^bbl^{e,” as}^des^c^ri^{bed i}ⁿ^t^e^x^t^{. T}^h^{e brack}^et^’^s^u^{pper bou}ⁿ^d
^depen^d^s^on^th^eⁿ^u^m^{ber of}^ex^em^ption^s^claim^e^{d by}^th^{e tax}^p^ay^{er. T}^h^{e ex}^am^{ple in}^th^is^{table as}^s^u^m^e^s^on^e
^ex^em^ption^f^o^{r s}ⁱⁿ^g^l^{e retu}^rn^s^,^tw^{o f}^o^{r th}^{e oth}^e^{r s}^t^atu^s^es^.

Table 6. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1991
Personal Exemptions$2,150
Standard Deductions
Joint$5,700
Single3,400
Head of Household5,000
Additional Standard Deductions for the Elderly and the Blind
Joint $650
Single/Head of Household850
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 34,00015% of the amount over $0
$ 34,000 - $ 82,150$ 5,100 + 28% of the amount over $ 34,000
$ 82,150 and over$18,582 + 31% of the amount over $ 82,150
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 20,35015% of the amount over $0
$ 20,350 - $ 49,300$ 3,052.50 + 28% of the amount over $ 20,350
$ 49,300 and over$11,158.50 + 31% of the amount over $ 49,300
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$ 0 - $ 27,30015% of the amount over $0
$ 27,300 - $ 70,450$ 4,095 + 28% of the amount over $ 27,300
$ 70,450 and over$16,177 + 31% of the amount over $ 70,450

Table 7. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1992
Personal Exemptions$2,300
Standard Deductions
Joint$6,000
Single3,600
Head of Household5,250
Additional Standard Deductions for the Elderly and the Blind
Joint $700
Single/Head of Household900
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 35,80015% of the amount over $0
$ 35,800 - $ 86,500$ 5,370 + 28% of the amount over $ 35,800
$ 86,500 and over$19,566 + 31% of the amount over $ 86,500
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 21,45015% of the amount over $0
$ 21,450 - $ 51,900$ 3,218 + 28% of the amount over $ 21,450
$ 51,900 and over$11,744 + 31% of the amount over $ 51,900
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 28,75015% of the amount over $0
$ 28,750 - $ 74,150$ 4,313 + 28% of the amount over $ 28,750
$ 74,150 and over$17,235 + 31% of the amount over $ 74,150

Table 8. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1993
Personal Exemptions$2,350
Standard Deductions
Joint$6,200
Single3,700
Head of Household5,450
Additional Standard Deductions for the Elderly and the Blind
Joint $700
Single/Head of Household900
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 36,90015% of the amount over $0
$ 36,900 - $ 89,150$5,535 + 28% of the amount over $36,900
$ 89,150 - $ 140,000$20,165 + 31% of the amount over $89,150
$ 140,000 - $ 250,000$35,929 + 36% of the amount over $140,000
$ 250,000 and over$75,529 + 39.6% of the amount over $250,000
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 22,10015% of the amount over $0
$ 22,100 - $53,500$3,315 + 28% of the amount over $22,100
$ 53,500 - $ 115,000$12,107 + 31% of the amount over $53,500
$ 115,000 - $ 250,000$31,172 + 36% of the amount over $115,000
$ 250,000 and over$79,772 + 39.6% of the amount over $250,000
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 29,60015% of the amount over $0
$ 29,600 - $ 76,400$4,440 + 28% of the amount over $29,600
$ 76,400 - $ 127,500$17,544 + 31% of the amount over $76,400
$ 127,500 - $ 250,000$33,385 + 36% of the amount over $127,500
$ 250,000 and over$77,485 + 39.6% of the amount over $250,000

Table 9. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1994
Personal Exemptions$2,450
Standard Deductions
Joint$6,350
Single3,800
Head of Household5,600
Additional Standard Deductions for the Elderly and the Blind
Joint $750
Single/Head of Household950
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 38,00015% of the amount over $0
$ 38,000 - $ 91,850$5,700 + 28% of the amount over $38,000
$ 91,850 - $ 140,000$20,778 + 31% of the amount over $91,850
$ 140,000 - $ 250,000 $35,705 + 36% of the amount over $140,000
$ 250,000 and over$75,305 + 39.6% of the amount over $250,000
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 22,75015% of the amount over $0
$ 22,750 - $ 55,100$3,413 + 28% of the amount over $22,750
$ 55,100 - $ 115,000$12,471 + 31% of the amount over $55,100
$ 115,000 - $ 250,000$31,040 + 36% of the amount over $115,000
$ 250,000 and over$79,640 + 39.6% of the amount over $250,000
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 30,50015% of the amount over $0
$ 30,500 - $ 78,700$4,575 + 28% of the amount over $30,500
$ 78,700 - $ 127,500$18,071 + 31% of the amount over $78,750
$ 127,500 - $ 250,000 $33,199 + 36% of the amount over $127,500
$ 250,000 and over$77,299 + 39.6% of the amount over $250,000

Table 10. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1995
Personal Exemptions$2,500
Standard Deductions
Joint$6,550
Single3,900
Head of Household5,750
Additional Standard Deductions for the Elderly and the Blind
Joint $750
Single/Head of Household950
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 39,00015% of the amount over $0
$ 39,000 - $ 94,250$5,850 + 28% of the amount over $39,000
$ 94,250 - $ 143,600$21,320 + 31% of the amount over $94,250
$ 143,600 - $ 256,500 $36,619 + 36% of the amount over $143,600
$ 256,500 and over$77,263 + 39.6% of the amount over $256,500
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 23,35015% of the amount over $0
$ 23,350 - $ 56,550$3,503 + 28% of the amount over $23,350
$ 56,550 - $ 117,950$12,799 + 31% of the amount over $56,550
$ 117,950 - $ 256,500$31,833 + 36% of the amount over $117,950
$ 256,500 and over$81,711 + 39.6% of the amount over $256,500
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 31,25015% of the amount over $0
$ 31,250 - $ 80,750$4,688 + 28% of the amount over $31,250
$ 80,750 - $ 130,800$18,548 + 31% of the amount over $80,750
$ 130,800 - $ 256,500 $34,063 + 36% of the amount over $130,800
$ 256,500 and over$79,315 + 39.6% of the amount over $256,500

Table 11. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1996
Personal Exemptions$2,550
Standard Deductions
Joint$6,700
Single4,000
Head of Household5,900
Additional Standard Deductions for the Elderly and the Blind
Joint $800
Single/Head of Household1,000
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 40,10015% of the amount over $0
$ 40,100 - $ 96,900$6,015 + 28% of the amount over $40,100
$ 96,900 - $ 147,700$21,919 + 31% of the amount over $96,900
$ 147,700 - $ 263,750 $37,667 + 36% of the amount over $147,700
$ 263,750 and over$79,445 + 39.6% of the amount over $263,750
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 24,00015% of the amount over $0
$ 24,000 - $ 58,150$3,600 + 28% of the amount over $24,000
$ 58,150 - $ 121,300$13,162 + 31% of the amount over $58,150
$ 121,300 - $ 263,750$32,739 + 36% of the amount over $121,300
$ 263,750 and over$84,021 + 39.6% of the amount over $263,750
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 32,15015% of the amount over $0
$ 32,150 - $ 83,050$4,823 + 28% of the amount over $32,150
$ 83,050 - $ 134,500$19,075 + 31% of the amount over $83,050
$ 134,500 - $ 263,750 $35,025 + 36% of the amount over $134,500
$ 263,750 and over$81,555 + 39.6% of the amount over $263,750

Table 12. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1997
Personal Exemptions$2,650
Standard Deductions
Joint$6,900
Single4,150
Head of Household6,050
Additional Standard Deductions for the Elderly and the Blind
Joint $800
Single/Head of Household1,000
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 41,20015% of the amount over $0
$ 41,200 - $ 99,600$6,180 + 28% of the amount over $41,200
$ 99,600 - $ 151,750$22,532 + 31% of the amount over $99,600
$ 151,750 - $ 271,050 $38,699 + 36% of the amount over $151,750
$ 271,050 and over$81,647 + 39.6% of the amount over $271,050
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 24,65015% of the amount over $0
$ 24,650 - $ 59,750$3,698 + 28% of the amount over $24,650
$ 59,750 - $ 124,650$13,526 + 31% of the amount over $59,750
$ 124,650 - $ 271,050$33,645 + 36% of the amount over $124,650
$ 271,050 and over$86,349 + 39.6% of the amount over $271,050
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 33,05015% of the amount over $0
$ 33,050 - $ 83,350$4,958 + 28% of the amount over $33,050
$ 83,350 - $ 138,200$19,602 + 31% of the amount over $85,350
$ 138,200 - $ 271,050 $35,986 + 36% of the amount over $138,200
$ 271,050 and over$83,812 + 39.6% of the amount over $271,050

Table 13. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1998
Personal Exemptions$2,700
Standard Deductions
Joint$7,100
Single4,250
Head of Household6,250
Additional Standard Deductions for the Elderly and the Blind
Joint $850
Single/Head of Household1,050
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 42,35015% of the amount over $0
$ 42,350 - $ 102,300$6,353 + 28% of the amount over $42,350
$ 102,300 - $ 155,950$23,139 + 31% of the amount over $102,300
$ 155,950 - $ 278,450 $39,770 + 36% of the amount over $155,950
$ 278,450 and over$83,870 + 39.6% of the amount over $278,450
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 25,35015% of the amount over $0
$ 25,350 - $ 61,400$3,803 + 28% of the amount over $25,350
$ 61,400 - $ 128,100$13,897 + 31% of the amount over $61,400
$ 128,100 - $ 278,450$34,574 + 36% of the amount over $128,100
$ 278,450 and over$88,700 + 39.6% of the amount over $278,450
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 33,95015% of the amount over $0
$ 33,950 - $ 87,700$5,093 + 28% of the amount over $33,950
$ 87,700 - $ 142,000$20,143 + 31% of the amount over $87,700
$ 142,000 - $ 278,450 $36,976+ 36% of the amount over $142,000
$ 278,450 and over$86,098 + 39.6% of the amount over $278,450

Table 14. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 1999
Personal Exemptions$2,750
Standard Deductions
Joint$7,200
Single4,300
Head of Household6,350
Additional Standard Deductions for the Elderly and the Blind
Joint $850
Single/Head of Household1,050
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 43,05015% of the amount over $0
$ 43,050 - $ 104,050$6,458 + 28% of the amount over $43,050
$ 104,050 - $ 158,550$23,538 + 31% of the amount over $104,050
$ 158,550 - $ 283,150 $40,433 + 36% of the amount over $158,550
$ 283,150 and over$85,289 + 39.6% of the amount over $283,150
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 25,75015% of the amount over $0
$ 25,750 - $ 62,450$3,863 + 28% of the amount over $25,750
$ 62,450 - $ 130,250$14,139 + 31% of the amount over $62,450
$ 130,250 - $ 283,150$35,157 + 36% of the amount over $130,250
$ 283,150 and over$90,201 + 39.6% of the amount over $283,150
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 34,55015% of the amount over $0
$ 34,550 - $ 89,150$5,183 + 28% of the amount over $34,550
$ 89,150 - $ 144,400$20,471 + 31% of the amount over $89,150
$ 144,400 - $ 283,150 $37,598 + 36% of the amount over $144,440
$ 283,150 and over$87,548 + 39.6% of the amount over $283,150

Table 15. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 2000
Personal Exemptions$2,800
Standard Deductions
Joint$7,350
Single4,400
Head of Household6,450
Additional Standard Deductions for the Elderly and the Blind
Joint $850
Single/Head of Household1,100
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 43,85015% of the amount over $0
$ 43,850 - $ 105,950$6,578 + 28% of the amount over $43,850
$ 105,950 - $ 161,450$23,966 + 31% of the amount over $105,950
$ 161,450 - $ 288,350 $41,171 + 36% of the amount over $161,450
$ 288,350 and over$86,855 + 39.6% of the amount over $288,350
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 26,25015% of the amount over $0
$ 26,250 - $ 63,550$3,938 + 28% of the amount over $26,250
$ 63,550 - $ 132,600$14,382 + 31% of the amount over $63,550
$ 132,600 - $ 288,350$35,787 + 36% of the amount over $132,600
$ 288,350 and over$91,857 + 39.6% of the amount over $288,350
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 35,15015% of the amount over $0
$ 35,150 - $ 90,800$5,273 + 28% of the amount over $35,150
$ 90,800 - $ 147,050$20,855 + 31% of the amount over $90,800
$ 147,050 - $ 288,350 $38,292 + 36% of the amount over $147,050
$ 288,350 and over$89,160 + 39.6% of the amount over $288,350

Table 16. Personal Exemptions, Standard Deductions, and
Statutory Tax Rates, 2001
Personal Exemptions$2,900
Standard Deductions
Joint$7,600
Single4,550
Head of Household6,650
Additional Standard Deductions for the Elderly and the Blind
Joint $900
Single/Head of Household1,100
Statutory Marginal Income Tax Rates, Joint Returns
If taxable income is:Then, tax is:
$0 - $ 45,20015% of the amount over $0
$ 45,200 - $ 109,250$6,780 + 27.5% of the amount over $45,200
$ 109,250 - $ 166,500$24,394 + 30.5% of the amount over $109,250
$ 166,500 - $ 297,350 $41,855 + 35.5% of the amount over $166,500
$ 297,350 and over$88,307 + 39.1% of the amount over $297,350
Statutory Marginal Income Tax Rates, Single Returns
If taxable income is:Then, tax is:
$0 - $ 27,05015% of the amount over $0
$ 27,050 - $ 65,550$4,058 + 27.5% of the amount over $27,050
$ 65,550 - $ 136,750$14,646 + 30.5% of the amount over $65,550
$ 136,750 - $ 297,350$36,362 + 35.5% of the amount over $136,750
$ 297,350 and over$93,375 + 39.1% of the amount over $297,350
Statutory Marginal Income Tax Rates, Heads of Households
If taxable income is:Then, tax is:
$0 - $ 36,25015% of the amount over $0
$ 36,250 - $ 93,650$5,438 + 27.5% of the amount over $36,250
$ 93,650 - $ 151,650$21,223 + 30.5% of the amount over $93,650
$ 151,650 - $ 297,350 $38,913 + 35.5% of the amount over $151,650
$ 297,350 and over$90,637 + 39.1% of the amount over $297,350

Table 17. Personal Exemptions and
Standard Deductions, 2002
Personal Exemptions$3,000
Standard Deductions:
Joint$7,850
Single$4,700
Head of Household$6,900
Additional Standard Deductions for the Elderly and the Blind:
Joint$900
Single/Head of Household$1,150

Table 18. Statutory Marginal Tax Rates, 2002
Joint Returns
If taxable income is:Then, tax is:
$ 0to$12,00010% of the amount over $0
$12,000to$46,700$1,200 + 15% of the amount over $12,000
$46,700to$112,850$6,405 + 27% of the amount over $46,700
$112,850to$171,950$24,266 + 30% of the amount over $112,850
$171,950to$307,050$41,996 + 35% of the amount over $171,950
$307,050and$89,281 + 38.6% of the amount over $307,050
over
Single Returns
If taxable income is:Then, tax is:
$0to$6,00010% of the amount over $0
$6,000to$27,950$600 + 15% of the amount over $6,000
$27,950to$67,700$3,893 + 27% of the amount over $27,950
$67,700to$141,250$14,626 + 30% of the amount over $67,700
$141,250to$307,050$36,691 + 35% of the amount over $141,250
$307,050and$94,721 + 38.6% of the amount over $307,050
over
Heads of Households
If taxable income is:Then, tax is:
$0 to $10,00010% of the amount over $0
$10,000to$37,450$1,000 + 15% of the amount over $10,000
$37,450to$96,700$5,118 + 27% of the amount over $37,450
$96,700to$156,600$21,116 + 30% of the amount over $96,700
$156,600to$307,050$39,086 + 35% of the amount over $156,600
$307,050and$91,744 + 38.6% of the amount over $307,050

over

Table 19. Statutory Marginal Tax Rates, 2003 Under Prior Law
(prior to enactment of the Jobs and Growth Tax Relief Reconciliation Act)
Joint Returns
If taxable income is:Then, tax is:
$ 0to$12,00010% of the amount over $0
$12,000to$47,450$1,200 + 15% of the amount over $12,000
$47,450to$114,650$6,518 + 27% of the amount over $47,450
$114,650to$174,700$24,662 + 30% of the amount over $114,650
$174,700to$311,950$42,677 + 35% of the amount over $174,700
$311,950and$90,714 + 38.6% of the amount over $311,950
over
Standard Deduction for a joint return was $7,950
Single Returns
If taxable income is:Then, tax is:
$0to$6,00010% of the amount over $0
$6,000to$28,400$600 + 15% of the amount over $6,000
$28,400to$68,800$3,960 + 27% of the amount over $28,400
$68,800to$143,500$14,868 + 30% of the amount over $68,800
$143,500to$311,950$37,278 + 35% of the amount over $143,500
$311,950and$96,236 + 38.6% of the amount over $311,950
over
Standard deduction for a single return is $4,750
Heads of Households
If taxable income is:Then, tax is:
$0 to $10,00010% of the amount over $0
$10,000to$38,050$1,000 + 15% of the amount over $10,000
$38,050to$98,250$5,208 + 27% of the amount over $38,050
$98,250to$159,100$21,462 + 30% of the amount over $98,250
$159,100to$311,950$39,717 + 35% of the amount over $159,100
$311,950and$93,214 + 38.6% of the amount over $311,950
over
Standard deduction for head of household return is $7,000

Table 20. Personal Exemptions and Standard Deductions,
Limitation on Itemized Deductions, and the Personal Exemption
Phase-out, 2003
(after enactment of the Jobs and Growth Tax Relief Reconciliation Act)
Personal Exemptions$3,050
Standard Deductions:
Joint$9,500
Single$4,750
Head of Household$7,000
Additional Standard Deductions for the Elderly and the Blind:
Joint$950
Single/Head of Household$1,150
Limitation on itemized deductions:$139,500
Phase-out of personal exemptions:
Joint$209,250
Head of household$174,400
Single $139,500

Table 21. Statutory Marginal Income Tax Rates, 2003
(after enactment of the Jobs and Growth Tax Relief Reconciliation Act)
Joint Returns
If taxable income is:Then, tax is:
$ 0to$14,00010% of the amount over $0
$14,000to$56,800$1,400 + 15% of the amount over $14,000
$56,800to$114,650$7,820 + 25% of the amount over $56,800
$114,650to$174,700$22,283 + 28% of the amount over $114,650
$174,700to$311,950$39,097 + 33% of the amount over $174,700
$311,950and$84,390 + 35% of the amount over $311,950
over
Single Returns
If taxable income is:Then, tax is:
$0to$7,00010% of the amount over $0
$7,000to$28,400$700 + 15% of the amount over $7,000
$28,400to$68,800$3,910 + 25% of the amount over $28,400
$68,800to$143,500$14,010 + 28% of the amount over $68,800
$143,500to$311,950$34,926 + 33% of the amount over $143,500
$311,950and$90,515 + 35% of the amount over $311,950
over
Heads of Households
If taxable income is:Then, tax is:
$0 to $10,00010% of the amount over $0
$10,000to$38,050$1,000 + 15% of the amount over $10,000
$38,050to$98,250$5,208 + 25% of the amount over $38,050
$98,250to$159,100$20,258 + 28% of the amount over $98,250
$159,100to$311,950$37,296 + 33% of the amount over $159,100
$311,950and$87,737 + 35% of the amount over $311,950

over

Table 22. Personal Exemptions and Standard Deductions,
Limitation on Itemized Deductions, and the Personal Exemption
Phase-out, 2004
Personal Exemptions$3,100
Standard Deductions:
Joint$9,700
Single$4,850
Head of Household$7,150
Additional Standard Deductions for the Elderly and the Blind:
Joint$950
Single/Head of Household$1,200
Limitation on itemized deductions:$142,700
Phase-out of personal exemptions:
Joint$214,050
Head of household$178,350
Single $142,700

Table 23. Statutory Marginal Income Tax Rates, 2004
Joint Returns
If taxable income is:Then, tax is:
$ 0to$14,30010% of the amount over $0
$14,300to$58,100$1,430 + 15% of the amount over $14,300
$58,100to$117,250$8,000 + 25% of the amount over $58,100
$117,250to$178,650$22,788 + 28% of the amount over $117,250
$178,650to$319,100$39,980 + 33% of the amount over $178,650
$319,100and$86,328 + 35% of the amount over $319,100
over
Single Returns
If taxable income is:Then, tax is:
$0to$7,15010% of the amount over $0
$7,150to$29,050$715 + 15% of the amount over $7,150
$29,050to$70,350$4,000 + 25% of the amount over $29,050
$70,350to$146,750$14,325 + 28% of the amount over $70,350
$146,750to$319,100$35,717 + 33% of the amount over $146,750
$319,100and$92,593 + 35% of the amount over $319,100
over
Heads of Households
If taxable income is:Then, tax is:
$0 to $10,20010% of the amount over $0
$10,200to$38,900$1,020 + 15% of the amount over $10,200
$38,900to$100,500$5,325 + 25% of the amount over $38,900
$100,500to$162,700$20,725 + 28% of the amount over $100,500
$162,700to$319,100$38,141 + 33% of the amount over $162,700
$319,100and$89,753 + 35% of the amount over $319,100

over

Table 24. Personal Exemptions, Standard Deductions,
Limitation on Itemized Deductions and the Personal Exemption
Phase-out Thresholds, 2005
Personal Exemptions$3,200
Standard Deductions:
Joint$10,000
Single$5,000
Head of Household$7,300
Additional Standard Deductions for the Elderly and the Blind:
Joint (each spouse)$1,000
Single/Head of Household$1,250
Limitation on itemized deductions:$145,950
Phase-out of personal exemptions:
Joint$218,950
Head of household$182,450
Single $145,950

Table 25. Statutory Marginal Income Tax Rates, 2005
Joint Returns
If taxable income is:Then, tax is:
$ 0to$14,60010% of the amount over $0
$14,600to$59,400$1,460 + 15% of the amount over $14,600
$59,400to$119,950$8,180 + 25% of the amount over $59,400
$119,950to$182,800$23,318 + 28% of the amount over $119,950
$182,800to$326,450$40,916 + 33% of the amount over $182,800
$326,450and$88,321 + 35% of the amount over $326,450
over
Single Returns
If taxable income is:Then, tax is:
$0to$7,30010% of the amount over $0
$7,300to$29,700$730 + 15% of the amount over $7,300
$29,700to$71,950$4,090 + 25% of the amount over $29,700
$71,950to$150,150$14,653 + 28% of the amount over $71,950
$150,150to$326,450$36,549 + 33% of the amount over $150,150
$326,450and$94,728 + 35% of the amount over $326,450
over
Heads of Households
If taxable income is:Then, tax is:
$0 to $10,45010% of the amount over $0
$10,450to$39,800$1,045 + 15% of the amount over $10,450
$39,800to$102,800$5,448 + 25% of the amount over $39,800
$102,800to$166,450$21,198 + 28% of the amount over $102,800
$166,450to$326,450$39,020 + 33% of the amount over $166,450
$326,450and$91,820 + 35% of the amount over $326,450

over

Table 26. Personal Exemptions, Standard Deductions,
Limitation on Itemized Deductions and the Personal Exemption
Phase-out Thresholds, 2006
Personal Exemptions$3,300
Standard Deductions:
Joint$10,300
Single$5,150
Head of Household$7,550
Additional Standard Deductions for the Elderly and the Blind:
Joint (each spouse)$1,000
Single/Head of Household$1,250
Limitation on itemized deductions:$150,500
Phase-out of personal exemptions:
Joint$225,750
Head of household$188,150
Single $150,500

Table 27. Statutory Marginal Income Tax Rates, 2006
Joint Returns
If taxable income is:Then, tax is:
$ 0to$15,10010% of the amount over $0
$15,100to$61,300$1,510 + 15% of the amount over $15,100
$61,300to$123,700$8,440 + 25% of the amount over $61,300
$123,700to$188,450$24,040 + 28% of the amount over $123,700
$188,450to$336,550$42,170 + 33% of the amount over $188,450
$336,550and$91,043 + 35% of the amount over $336,550
over
Single Returns
If taxable income is:Then, tax is:
$0to$7,55010% of the amount over $0
$7,550to$30,650$755 + 15% of the amount over $7,550
$30,650to$74,200$4,220 + 25% of the amount over $30,650
$74,200to$154,800$15,108 + 28% of the amount over $74,200
$154,800to$336,550$37,676 + 33% of the amount over $154,800
$336,550and$97,653 + 35% of the amount over $336,550
over
Heads of Households
If taxable income is:Then, tax is:
$0 to $10,75010% of the amount over $0
$10,750to$41,050$1,075 + 15% of the amount over $10,750
$41,050to$106,000$5,620 + 25% of the amount over $41,050
$106,000to$171,650$21,858 + 28% of the amount over $106,000
$171,650to$336,550$40,240 + 33% of the amount over $171,650
$336,550and$94,657 + 35% of the amount over $336,550

over

Table 28. Personal Exemptions, Standard Deductions,
Limitation on Itemized Deductions and the Personal Exemption
Phase-out Thresholds, 2007
Personal Exemptions$3,400
Standard Deductions:
Joint$10,700
Single$5,350
Head of Household$7,850
Additional Standard Deductions for the Elderly and the Blind:
Joint (each spouse)$1,050
Single/Head of Household$1,300
Limitation on itemized deductions:$156,400
Phase-out of personal exemptions:
Joint$234,600
Head of household$195,500
Single $156,400

Table 29. Statutory Marginal Income Tax Rates, 2007
Joint Returns
If taxable income is:Then, tax is:
$ 0to$15,65010% of the amount over $0
$15,650to$63,700$1,565 + 15% of the amount over $15,650
$63,700to$128,500$8,773 + 25% of the amount over $63,700
$128,500to$195,850$24,973 + 28% of the amount over $128,500
$195,850to$349,700$43,831 + 33% of the amount over $195,850
$349,700and$94,601 + 35% of the amount over $349,700
over
Single Returns
If taxable income is:Then, tax is:
$0to$7,82510% of the amount over $0
$7,825to$31,850$783 + 15% of the amount over $7,825
$31,850to$77,100$4,386 + 25% of the amount over $31,850
$77,100to$160,850$15,699 + 28% of the amount over $77,100
$160,850to$349,700$39,149 + 33% of the amount over $160,850
$349,700and$101,469 + 35% of the amount over $349,700
over
Heads of Households
If taxable income is:Then, tax is:
$0 to $11,20010% of the amount over $0
$11,200to$42,650$1,120 + 15% of the amount over $11,200
$42,650to$110,100$5,838 + 25% of the amount over $42,650
$110,100to$178,350$22,700 + 28% of the amount over $110,100
$178,350to$349,700$41,810 + 33% of the amount over $178,350
$349,700and$98,356 + 35% of the amount over $349,700

over

Table 30. Personal Exemptions, Standard Deductions,
Limitation on Itemized Deductions and the Personal Exemption
Phase-out Thresholds, 2008
Personal Exemptions$3,500
Standard Deductions:
Joint$10,900
Single$5,450
Head of Household$8,000
Additional Standard Deductions for the Elderly and the Blind:
Joint (each spouse)$1,050
Single/Head of Household$1,350
Limitation on itemized deductions:$159,950
Phase-out of personal exemptions:
Joint$239,950
Head of household$199,900
Single $159,950

Table 31. Statutory Marginal Income Tax Rates, 2008
Joint Returns
If taxable income is:Then, tax is:
$ 0to$16,05010% of the amount over $0
$16,050to$65,100$1,605 + 15% of the amount over $16,050
$65,100to$131,450$8,962.50 + 25% of the amount over $65,100
$131,450to$200,300$25,550 + 28% of the amount over $131,450
$200,300to$357,700$44,828 + 33% of the amount over $200,300
$357,700and$96,770 + 35% of the amount over $357,700
over
Single Returns
If taxable income is:Then, tax is:
$0to$8,02510% of the amount over $0
$8,025to$32,550$802.50 + 15% of the amount over $8,025
$32,550to$78,850$4,481.25 + 25% of the amount over $32,550
$78,850to$164,550$16,056.25 + 28% of the amount over $78,850
$164,550to$357,700$40,052.25 + 33% of the amount over $164,550
$357,700and$103,791.75 + 35% of the amount over $357,700
over
Heads of Households
If taxable income is:Then, tax is:
$0to $11,45010% of the amount over $0
$11,450to$43,650$1,145 + 15% of the amount over $11,450
$43,650to$112,650$5,975 + 25% of the amount over $43,650
$112,650to$182,400$23,225 + 28% of the amount over $112,650
$182,400to$357,700$42,755 + 33% of the amount over $182,400
$357,700and$100,604 + 35% of the amount over $357,700
over

Table 32. Personal Exemptions, Standard Deductions,
Limitation on Itemized Deductions and the Personal Exemption
Phase-out Thresholds, 2009
Personal Exemptions$3,650
Standard Deductions:
Joint$11,400
Single$5,700
Head of Household$8,350
Additional Standard Deductions for the Elderly and the Blind:
Joint (each spouse)$1,100
Single/Head of Household$1,400
Limitation on itemized deductions:$166,800
Phase-out of personal exemptions:
Joint$250,200
Head of household$208,500
Single $166,800

Table 33. Statutory Marginal Income Tax Rates, 2009
Joint Returns
If taxable income is:Then, tax is:
$ 0to$16,70010% of the amount over $0
$16,700to$67,900$1,670 + 15% of the amount over $16,700
$67,900to$137,050$9,350 + 25% of the amount over $67,900
$137,050to$208,850$26,637.50 + 28% of the amount over $137,050
$208,850to$372,950$46,741.50 + 33% of the amount over $208,850
$372,950and$100,894.50 + 35% of the amount over $372,950
over
Single Returns
If taxable income is:Then, tax is:
$0to$8,35010% of the amount over $0
$8,350to$33,950$835 + 15% of the amount over $8,350
$33,950to$82,250$4,675 + 25% of the amount over $33,950
$82,250to$171,550$16,750 + 28% of the amount over $82,250
$171,550to$372,950$41,754 + 33% of the amount over $171,550
$372,950and$108,216 + 35% of the amount over $372,950
over
Heads of Households
If taxable income is:Then, tax is:
$0to $11,95010% of the amount over $0
$11,950to$45,500$1,195 + 15% of the amount over $11,950
$45,500to$117,450$6,227.50 + 25% of the amount over $45,500
$117,450to$190,200$24,215 + 28% of the amount over $117,450
$190,200to$372,950$44,585 + 33% of the amount over $190,200
$372,950and$104,892.50 + 35% of the amount over $372,950
over