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Incentives drive behavior. How does the United States personal income tax schedule incentivize taxpayers?
Federal tax tables define distinct tax brackets with rates ranging from 10-35%. A plot condensing this information into one graph is presented in Figure 1.
Figure 1. Total taxation as a function of taxable income & filing status (derived from 2009 tax table). Dashed lines identify the alternative minimum tax zero exemption thresholds for 2009.
Note 1: In 2010 the AMT exemption is scheduled to decrease to $33,750 (single), $45,000 (joint), and $22,500 (separate). In 2009 the AMT exemptions were $46,700 (single/head), $70,950 (joint), and $35,475 (separate).
Figure 2. Total taxation as a function of taxable income & filing status (derived from 2009 tax table). Use this log-log plot to see how much your taxation changes with filing status.
Note 2: For 2009 the zero exemption thresholds were $299,300 (single/head), $433,800 (joint), and $216,900 (separate).
Disclaimer: Onyx Research, Inc. does not provide tax advice. Consult your tax advisor to optimize your tax situation.
Data Source: Internal Revenue Service
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