OT- tax stats

[kathyc2]

In 2015 18,061 returns had AGI of over 10M. That is .012% or roughly 1 of every 8,000 returns.

Of these returns 11,004 had pass through income of 114B or 15% of all pass through income.

The pass through income of this group was 21% of their total AGI.

Assuming this part of income was taxed at 39.6%, revenue would be 45B.

The 20% deduction and top rate of 37% might reduce revenue by 11B to 34B.

11B times the 8 years this is in effect is 91B or 6% of the total 1.5T projection.

In other words, 6% of the total net tax cuts go to the 11,004 returns that have AGI over 10M and also have pass through income.

[kathyc2]

Also, the tax stats show the average effective tax rate for groups as:

Less than 500K AGI 19.5% or less EFR
500K to 1M 26%
1M to 1.5M 28.3%
1.5M to 2M 29.2%
2M to 5M 29.5%
5M to 10M 28.8%
over 10M 25.5%

[Lion]

Doesn't the pass-through deduction phase out starting at $315,000 of taxable income? If so, it won't help the taxpayers in your original post.

[kathyc2]

Doesn't the pass-through deduction phase out starting at $315,000 of taxable income? If so, it won't help the taxpayers in your original post.

I believe that only applies to certain service type businesses. Other types of business would still get it as long as they meet W-2 requirements. You are correct that the entire amount of pass through income in this range would not qualify for the 20%, but I'm sure going to check how much does when 2018 return data is released in 2020.

Also, some of the pass through income already had a deduction for DPAD, so my 6% calculation was off.

It just really ticks me off the the uber rich (> 10M) pays an average lower effective rate than the doing well crowd (500K-1M).