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Oct 1, 2024 | 
taxpolicycenter.org | Thomas Brosy |Thornton Matheson |Robert McClelland |Livia Mucciolo
Intangible assets, such as patents and research and development spending, represent an increasingly large fraction of investment in the economy. In this paper, we review the historic tax treatment of research and development and intangibles in the US and their economic significance. We update Tax Policy Center effective tax rate models by incorporating the capitalization of research and development, the research and experimentation tax credit, and the foreign-derived intangible income deduction.
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Sep 19, 2024 | 
taxpolicycenter.org | Janet Holtzblatt |Robert McClelland |Livia Mucciolo |Safia Sayed
The Inflation Reduction Act (IRA) of 2022 enacted an $80 billion 10-year investment in the Internal Revenue Service on top of the agency’s regular annual appropriations. Although Congress cut the IRA funding by over 25 percent the following year, the agency has maintained its commitment to the transformative IRS Inflation Reduction Act Strategic Operating Plan to bring the agency into the 21st century.
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Sep 17, 2024 | 
taxpolicycenter.org | Lucy Dadayan |Robert McClelland |Livia Mucciolo |Safia Sayed
Total state government tax revenue collections rose 3.0 percent in nominal terms and 0.6 percent in real terms in the first quarter of 2024 relative to a year earlier Key tax revenue sources showed mixed performance. In the first quarter of 2024, personal income tax revenues declined by 1.4 percent in real terms compared to the previous year, while corporate income tax revenues rose by 2.4 percent.
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Jul 10, 2024 | 
taxpolicycenter.org | Aravind Boddupalli |Luisa Godinez-Puig |Robert McClelland |Livia Mucciolo
Refundable tax credits like the child tax credit (CTC) and earned income tax credit (EITC) are proven policy tools for reducing poverty and improving health and educational outcomes for millions of families across the country. However, both legislation and administrative practices prevent many undocumented and mixed-status immigrant families from accessing these benefits.
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Jun 28, 2024 | 
taxpolicycenter.org | Lucy Dadayan |Robert McClelland |Livia Mucciolo |Safia Sayed
State revenue forecasters face multifaceted challenges in projecting revenues, especially amid rapid and significant economic, demographic, and technological changes. This report provides an in-depth examination of the challenges and complexities involved in state revenue forecasting across different economic phases. It spans from the post–Great Recession expansion through the COVID-19 pandemic and subsequent recovery.
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May 28, 2024 | 
taxpolicycenter.org | Lucy Dadayan |Robert McClelland |Livia Mucciolo |Safia Sayed
Total state government tax revenue collections rose by 4.5 percent in nominal terms and 1.8 percent in real terms in the fourth quarter of 2023 relative to a year earlier. Personal income tax revenues increased by 5.9 percent and corporate income tax revenues increased by 6.7 percent in real terms in the fourth quarter of 2023 compared relative to a year earlier.
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May 10, 2024 | 
taxpolicycenter.org | Timothy Dowd |Robert McClelland |Livia Mucciolo |Safia Sayed
Understanding how capital gains realizations respond to changes in capital gains tax rates is critical for understanding the potential revenue effects of these changes. A frequently relied on estimate of this responsiveness, or elasticity, comes from Dowd, McClelland, and Muthitacharoen (2015). Using individual-level federal tax return data, they found a short-term (within the current year) tax elasticity of -1.2 and a long-term (beyond the current year) tax elasticity of -0.72.
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Apr 10, 2024 | 
taxpolicycenter.org | Robert McClelland |Livia Mucciolo |Safia Sayed
Overview The federal government subsidizes charitable contributions for those taxpayers who have positive tax liability and itemize their deductions. However, especially since the passage of the 2017 Tax Cuts and Jobs Act, few taxpayers itemize, and those that do tend to have higher incomes – limiting the progressivity of the deduction.
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Apr 2, 2024 | 
taxpolicycenter.org | Janet Holtzblatt |Robert McClelland |Gabriella Garriga |Livia Mucciolo
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Apr 1, 2024 | 
taxpolicycenter.org | Steven Rosenthal |Livia Mucciolo |Robert McClelland |Safia Sayed
From 1965 to 2022, the share of outstanding U.S. stock held in taxable brokerage and mutual fund accounts declined from 79 percent to 27 percent, as reflected in data from the financial accounts of the U.S. government collected by the Federal Reserve. The share of publicly traded stock held in taxable accounts similarly declined from 81 percent to 28 percent (see Table 7). Foreign investors, retirement accounts, and other tax-exempt entities now dominate U.S. stock ownership.
