EFFECT OF THE 2003 TAX CUT ON MARGINAL RATES
Marginal Rate Upper Upper Effective Rate
Lower Upper --------------- Old New Percent ---------------
Limit Limit Old New Tax Tax Cut Old New
------- ------- ------- ------- ------- ------- ------- ------- -------
SINGLE
0 6000 10 10 600 600 0.0 10.0 10.0
6000 7000 15 10 750 700 6.7 10.7 10.0
7000 28400 15 15 3960 3910 1.3 13.9 13.8
28400 68800 27 25 14868 14010 5.8 21.6 20.4
68800 143500 30 28 37278 34926 6.3 26.0 24.3
143500 311950 35 33 96236 90515 5.9 30.8 29.0
311950 ^ 38.6 35 361823 331332 8.4 36.2 33.1
HEAD OF HOUSEHOLD
0 10000 10 10 1000 1000 0.0 10.0 10.0
10000 38050 15 15 5208 5208 0.0 13.7 13.7
38050 98250 27 25 21462 20258 5.6 21.8 20.6
98250 159100 30 28 39717 37296 6.1 25.0 23.4
159100 311950 35 33 93214 87736 5.9 29.9 28.1
311950 ^ 38.6 35 358801 328554 8.4 35.9 32.9
MARRIED-JOINT FILING
0 12000 10 10 1200 1200 0.0 10.0 10.0
12000 14000 15 10 1500 1400 6.7 10.7 10.0
14000 47450 15 15 6518 6418 1.5 13.7 13.5
47450 56800 27 15 9042 7820 13.5 15.9 13.8
56800 114650 27 25 24662 22283 9.6 21.5 19.4
114650 174700 30 28 42677 39097 8.4 24.4 22.4
174700 311950 35 33 90714 84389 7.0 29.1 27.1
311950 ^ 38.6 35 356301 325207 8.7 35.6 32.5
^ No upper limit. $1,000,000 is assumed for upper tax calculations
(tax calculations are on taxable income equal to the upper limit).
===============================================================================
PERCENT REDUCTION IN INCOME TAXES VIA THE 2003 TAX CUT*
SINGLE HEAD OF HOUSEHOLD MARRIED-JOINT FILING
----------------------- ----------------------- -----------------------
Taxable Old New Percent Old New Percent Old New Percent
Income Tax Tax Cut Tax Tax Cut Tax Tax Cut
------- ----------------------- ----------------------- -----------------------
3000 300 300 0.0 300 300 0.0 300 300 0.0
6000 600 600 0.0 600 600 0.0 600 600 0.0
7000 750 700 6.7 700 700 0.0 700 700 0.0
10000 1200 1150 4.2 1000 1000 0.0 1000 1000 0.0
12000 1500 1450 3.3 1300 1300 0.0 1200 1200 0.0
14000 1800 1750 2.8 1600 1600 0.0 1500 1400 6.7
20000 2700 2650 1.9 2500 2500 0.0 2400 2300 4.2
25000 3450 3400 1.4 3250 3250 0.0 3150 3050 3.2
28400 3960 3910 1.3 3760 3760 0.0 3660 3560 2.7
30000 4392 4310 1.9 4000 4000 0.0 3900 3800 2.6
38050 6566 6323 3.7 5208 5208 0.0 5108 5008 2.0
40000 7092 6810 4.0 5734 5695 0.7 5400 5300 1.9
47450 9104 8673 4.7 7746 7558 2.4 6518 6418 1.5
50000 9792 9310 4.9 8434 8195 2.8 7206 6800 5.6
56800 11628 11010 5.3 10270 9895 3.7 9042 7820 13.5
60000 12492 11810 5.5 11134 10695 3.9 9906 8620 13.0
68800 14868 14010 5.8 13510 12895 4.6 12282 10820 11.9
70000 15228 14346 5.8 13834 13195 4.6 12606 11120 11.8
80000 18228 17146 5.9 16534 15695 5.1 15306 13620 11.0
90000 21228 19946 6.0 19234 18195 5.4 18006 16120 10.5
98250 23703 22256 6.1 21462 20258 5.6 20234 18183 10.1
100000 24228 22746 6.1 21987 20748 5.6 20706 18620 10.1
114650 28623 26848 6.2 26382 24850 5.8 24662 22283 9.6
120000 30228 28346 6.2 27987 26348 5.9 26267 23781 9.5
140000 36228 33946 6.3 33987 31948 6.0 32267 29381 8.9
143500 37278 34926 6.3 35037 32928 6.0 33317 30361 8.9
159100 42738 40074 6.2 39717 37296 6.1 37997 34729 8.6
160000 43053 40371 6.2 40032 37593 6.1 38267 34981 8.6
174700 48198 45222 6.2 45177 42444 6.0 42677 39097 8.4
180000 50053 46971 6.2 47032 44193 6.0 44532 40846 8.3
200000 57053 53571 6.1 54032 50793 6.0 51532 47446 7.9
220000 64053 60171 6.1 61032 57393 6.0 58532 54046 7.7
240000 71053 66771 6.0 68032 63993 5.9 65532 60646 7.5
260000 78053 73371 6.0 75032 70593 5.9 72532 67246 7.3
280000 85053 79971 6.0 82032 77193 5.9 79532 73846 7.1
300000 92053 86571 6.0 89032 83793 5.9 86532 80446 7.0
311950 96236 90515 5.9 93214 87736 5.9 90714 84389 7.0
320000 99343 93332 6.1 96321 90554 6.0 93821 87207 7.1
340000 107063 100332 6.3 104041 97554 6.2 101541 94207 7.2
360000 114783 107332 6.5 111761 104554 6.4 109261 101207 7.4
380000 122503 114332 6.7 119481 111554 6.6 116981 108207 7.5
400000 130223 121332 6.8 127201 118554 6.8 124701 115207 7.6
600000 207423 191332 7.8 204401 188554 7.8 201901 185207 8.3
800000 284623 261332 8.2 281601 258554 8.2 279101 255207 8.6
1000000 361823 331332 8.4 358801 328554 8.4 356301 325207 8.7
2000000 747823 681332 8.9 744801 678554 8.9 742301 675207 9.0
* Percent reduction is for rates only. It does not include the increase in the
child tax credit or the reduction of the tax on dividends and capital gains.
Regarding the reduction in the marriage penalty, it does not include the
increase in the standard deduction for married couples filing jointly but it
does include the increase in the upper limit of the 15 percent bracket from
$47,450 to $56,800. Taxable income between these values was previously taxed
at 27% but is now taxed at 15%. This is the cause of the large spike in the
percent of tax reduction between these two incomes.
Note: Taxable income is income less deductions and personal exemptions
Source: http://www.golombard.com/tax_bracket.html (brackets after 2003 tax cut);
http://www.turbotax.com/articles/TaxRateSchedulesfor2003.html (brackets
before 2003 tax cut)
EFFECT OF THE 2001 AND 2003 TAX CUTS ON MARGINAL RATES
Marginal Rate Upper Upper Effective Rate
Lower Upper --------------- Old New Percent ---------------
Limit Limit Old New Tax Tax Cut Old New
------- ------- ------- ------- ------- ------- ------- ------- -------
SINGLE
0 6000 15 10 900 600 33.3 15.0 10.0
6000 7000 15 10 1050 700 33.3 15.0 10.0
7000 27050 15 15 4058 3708 8.6 15.0 13.7
27050 28400 28 15 4436 3910 11.8 15.6 13.8
28400 65550 28 25 14838 13198 11.1 22.6 20.1
65550 68800 31 25 15845 14010 11.6 23.0 20.4
68800 136750 31 28 36910 33036 10.5 27.0 24.2
136750 143500 36 28 39340 34926 11.2 27.4 24.3
143500 297350 36 33 94726 85697 9.5 31.9 28.8
297350 311950 39.6 33 100507 90515 9.9 32.2 29.0
311950 ^ 39.6 35 372975 331332 11.2 37.3 33.1
HEAD OF HOUSEHOLD
0 10000 15 10 1500 1000 33.3 15.0 10.0
10000 36250 15 15 5438 4938 9.2 15.0 13.6
36250 38050 28 15 5942 5208 12.4 15.6 13.7
38050 93650 28 25 21510 19108 11.2 23.0 20.4
93650 98250 31 25 22936 20258 11.7 23.3 20.6
98250 151650 31 28 39490 35210 10.8 26.0 23.2
151650 159100 36 28 42172 37296 11.6 26.5 23.4
159100 297350 36 33 91942 82918 9.8 30.9 27.9
297350 311950 39.6 33 97723 87736 10.2 31.3 28.1
311950 ^ 39.6 35 370191 328554 11.2 37.0 32.9
MARRIED-JOINT FILING
0 12000 15 10 1800 1200 33.3 15.0 10.0
12000 14000 15 10 2100 1400 33.3 15.0 10.0
14000 45200 15 15 6780 6080 10.3 15.0 13.5
45200 56800 28 15 10028 7820 22.0 17.7 13.8
56800 109250 28 25 24714 20933 15.3 22.6 19.2
109250 114650 31 25 26388 22283 15.6 23.0 19.4
114650 166500 31 28 42462 36801 13.3 25.5 22.1
166500 174700 36 28 45414 39097 13.9 26.0 22.4
174700 297350 36 33 89568 79571 11.2 30.1 26.8
297350 311950 39.6 33 95349 84389 11.5 30.6 27.1
311950 ^ 39.6 35.0 367817 325207 11.6 36.8 32.5
^ No upper limit. $1,000,000 is assumed for upper tax calculations
(tax calculations are on taxable income equal to the upper limit).
===============================================================================
PERCENT REDUCTION IN INCOME TAXES VIA THE 2001 AND 2003 TAX CUTS*
SINGLE HEAD OF HOUSEHOLD MARRIED-JOINT FILING
----------------------- ----------------------- -----------------------
Taxable Old New Percent Old New Percent Old New Percent
Income Tax Tax Cut Tax Tax Cut Tax Tax Cut
------- ----------------------- ----------------------- -----------------------
3000 450 300 33.3 450 300 33.3 450 300 33.3
6000 900 600 33.3 900 600 33.3 900 600 33.3
7000 1050 700 33.3 1050 700 33.3 1050 700 33.3
10000 1500 1150 23.3 1500 1000 33.3 1500 1000 33.3
12000 1800 1450 19.4 1800 1300 27.8 1800 1200 33.3
14000 2100 1750 16.7 2100 1600 23.8 2100 1400 33.3
20000 3000 2650 11.7 3000 2500 16.7 3000 2300 23.3
24000 3600 3250 9.7 3600 3100 13.9 3600 2900 19.4
27050 4058 3708 8.6 4058 3558 12.3 4058 3358 17.3
28400 4436 3910 11.8 4260 3760 11.7 4260 3560 16.4
30000 4884 4310 11.7 4500 4000 11.1 4500 3800 15.6
36250 6634 5873 11.5 5438 4938 9.2 5438 4738 12.9
38050 7138 6323 11.4 5942 5208 12.4 5708 5008 12.3
40000 7684 6810 11.4 6488 5695 12.2 6000 5300 11.7
45200 9140 8110 11.3 7944 6995 11.9 6780 6080 10.3
50000 10484 9310 11.2 9288 8195 11.8 8124 6800 16.3
56800 12388 11010 11.1 11192 9895 11.6 10028 7820 22.0
60000 13284 11810 11.1 12088 10695 11.5 10924 8620 21.1
65550 14838 13198 11.1 13642 12083 11.4 12478 10008 19.8
68800 15845 14010 11.6 14552 12895 11.4 13388 10820 19.2
70000 16217 14346 11.5 14888 13195 11.4 13724 11120 19.0
80000 19317 17146 11.2 17688 15695 11.3 16524 13620 17.6
90000 22417 19946 11.0 20488 18195 11.2 19324 16120 16.6
93650 23549 20968 11.0 21510 19108 11.2 20346 17033 16.3
98250 24975 22256 10.9 22936 20258 11.7 21634 18183 16.0
100000 25517 22746 10.9 23478 20748 11.6 22124 18620 15.8
109250 28385 25336 10.7 26346 23338 11.4 24714 20933 15.3
114650 30059 26848 10.7 28020 24850 11.3 26388 22283 15.6
120000 31717 28346 10.6 29678 26348 11.2 28047 23781 15.2
136750 36910 33036 10.5 34871 31038 11.0 33239 28471 14.3
140000 38080 33946 10.9 35878 31948 11.0 34247 29381 14.2
143500 39340 34926 11.2 36963 32928 10.9 35332 30361 14.1
151650 42274 37616 11.0 39490 35210 10.8 37858 32643 13.8
159100 44956 40074 10.9 42172 37296 11.6 40168 34729 13.5
160000 45280 40371 10.8 42496 37593 11.5 40447 34981 13.5
166500 47620 42516 10.7 44836 39738 11.4 42462 36801 13.3
174700 50572 45222 10.6 47788 42444 11.2 45414 39097 13.9
180000 52480 46971 10.5 49696 44193 11.1 47322 40846 13.7
200000 59680 53571 10.2 56896 50793 10.7 54522 47446 13.0
220000 66880 60171 10.0 64096 57393 10.5 61722 54046 12.4
240000 74080 66771 9.9 71296 63993 10.2 68922 60646 12.0
260000 81280 73371 9.7 78496 70593 10.1 76122 67246 11.7
280000 88480 79971 9.6 85696 77193 9.9 83322 73846 11.4
297350 94726 85697 9.5 91942 82918 9.8 89568 79571 11.2
311950 100507 90515 9.9 97723 87736 10.2 95349 84389 11.5
320000 103695 93332 10.0 100911 90554 10.3 98537 87207 11.5
340000 111615 100332 10.1 108831 97554 10.4 106457 94207 11.5
360000 119535 107332 10.2 116751 104554 10.4 114377 101207 11.5
380000 127455 114332 10.3 124671 111554 10.5 122297 108207 11.5
400000 135375 121332 10.4 132591 118554 10.6 130217 115207 11.5
600000 214575 191332 10.8 211791 188554 11.0 209417 185207 11.6
800000 293775 261332 11.0 290991 258554 11.1 288617 255207 11.6
1000000 372975 331332 11.2 370191 328554 11.2 367817 325207 11.6
2000000 768975 681332 11.4 766191 678554 11.4 763817 675207 11.6
* Percent reduction is for rates only. It does not include the increase in the
child tax credit or the reduction of the tax on dividends and capital gains.
Regarding the reduction in the marriage penalty, it does not include the
increase in the standard deduction for married couples filing jointly but it
does include the increase in the upper limit of the 15 percent bracket from
$45,200 to $56,800. Taxable income between these values was previously taxed
at 27% but is now taxed at 15%. This is the cause of the large spike in the
percent of tax reduction between these two incomes.
Note: Taxable income is income less deductions and personal exemptions
Source: http://www.golombard.com/tax_bracket.html (brackets after 2003 tax cut);
http://www.whitehouse.gov/news/reports/taxplan.html (brackets before
2001 tax cut)
Go to Taxes Home Page
Go to Budget Home Page