Congress has been cutting taxes periodically for better than twenty years. The idea of cutting taxes is very appealing, but has it helped hard-working American families?
1976 was the last year that most Americans took a close look at how the Tax Code was being abused by many of the very wealthy. In response to a large public outcry, Congress passed several reforms. Then in 1981, Reagan initiated the current period of tax reform legislation. The initial cuts were designed to benefit the Superrich, but we were assured that the economic benefits would soon "trickle down" to the rest of us.
What has it done for you and your family?
After two decades of effort, have the politicians delivered on their promises? Are you better off today? If you click on the words "How Did You Do?" below, you will be able to find out how those in your income group did. You might be surprised.
Get the facts
The government issues a yearly report on its collection activities. The report reflects how many people filed, their total income, and the amount paid in taxes. It also gives specific information on different income groups. From this information, we can determine how tax rates have changed for each income group and whether the real after- tax income has risen. The amount you have left after paying taxes determines how well you live.
The latest report the government has released is for the year 2000. The charts presented here are based upon a detailed comparison of the year 1976 report with the 2000 report. Reports for recent years are available on the IRS website. You'll have to go to the Statistical Abstract of the United States or The World Almanac and Book of Facts 1979 to get the report on the 1976 income taxes. Because of inflation, it took $3 in 2000 to buy as much as $1 bought in 1976. The government also publishes the Consumer Price Index to account for this change in buying power. The 1976 figures have been adjusted using the CPI to develop an accurate comparison.
For those of you who would like to delve deeper into the underlying data, a single chart containing all the data for the individual income ranges, and much more information, is available for download as an Adobe Acrobat Reader document. Just click the following link 2000 Income Tax Return Analysis.