Short answer: I don't know where that particular article might be, but the information you're looking for is on the internet. The highest current US marginal income tax rate is officially 39.6%. However, the effective marginal income tax rate can be greater than that due to the phasing out of personal exemptions and itemized deductions -- all part of our obscenely complicated income tax code.Long answer, pieced together from online sources:http://cas.uah.edu/geinerta/acc313/ClassNotes/chapter_1.htmFor example, even though the nominal maximum individual rate is 39.6%, the marginal rate will be increased by any phase-out of exemptions or itemized deductions.http://www.reporternews.com/1999/biz/tally0826.htmlThe spike up to a 50 percent marginal rate at $60,000 is the result of a double whammy: More Social Security benefits are being taxed at the same time the couple is moving into the 28 percent bracket. . . at $186,800, personal exemptions begin to disappear. . . This example is based on the standard deduction, but itemizers face an additional bump in taxes. Up to 80 percent of itemized deductions is disallowed at income levels above $124,500.http://www.cbpp.org/3-6-01tax2.htmLess than one percent of filers were in the top bracket, where the marginal tax rate is 39.6 percent. The average adjusted gross income of filers in the 39.6 percent bracket exceeded $900,000 in 1997. http://www.ctj.org/html/margfaq.htmQ: What percentage of taxpayers will pay at each of the federal income tax rates in 2001?A: For tax year 2001, more than 72 percent of taxpayers either pay a top marginal rate of 15 percent or don't pay federal income taxes at all. About a fifth of all taxpayers are subject to the 28 percent rate. This means that less than 5 percent of all taxpayers will pay at a marginal federal income tax rate above 28 percent in 2001, with less than 1 percent paying at the top marginal rate of 39.6 percent. (The previous two sites talk a lot about average income tax rates -- apparently in an effort to defend high marginal income tax rates by understating their effects. People don't actually decide whether to do additional work or make additional investments based on average income tax rates. They look instead at marginal tax rates. If people decide to work another hour or invest another dollar, it isn't an average hour or an average dollar that they think about, but the optional, last one.)On the significance of marginal rates:http://www.ncpa.org/oped/bartlett/feb1401.htmlThe point of this discussion is that only permanent changes in marginal tax rates affect the rate of return on work, saving and investment.Chips
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