TPC's New Tax Calculator

By :: September 10th, 2010

Long in the works, the Tax Policy Center’s new Tax Calculator debuted on our website this week. We designed it to help taxpayers, analysts, and the media see how current tax policy affects real families and what would happen if that policy changed.

To start, either create a taxpayer profile from scratch or choose one of our six sample households:


a non-elderly childless couple

a couple with a child in college


a couple with two children under age 13


a single person

a single mother with two children

a couple over age 65

Then pick an income level: low (20th percentile), median, or high (80th percentile) for your chosen household, or use any value you want.

Finally, choose one of three policy scenarios:

  • 2010 law with all of the 2001-2003 tax cuts still in place
  • 2011 tax law if almost all of the 2001-2003 tax cuts expire as scheduled
  • 2011 tax law if Congress enacts all of President Obama’s budget proposals—primarily extending the 2001-2003 tax cuts for couples with income under $250,000 and singles with income under $200,000 but also keeping the Making Work Pay credit for another year.

Click “Go” to see the income and other numbers for your chosen case and change them if you want to. Then hit “Calculate Tax” and—voila! —you’ll get basic tax info: total income, taxable income, income tax liability, and average and marginal tax rate. (The calculator only shows 2010 taxes for now; TC2.0 will cover more years.)

Want to compare a different policy? Click that choice and new numbers appear.

Want to change income or deductions? Just type in new numbers, and you’ve got another case.

Take the Tax Calculator on a test drive and let us know what you think.

19Comments

  1. Anonymous  ::  7:31 pm on September 10th, 2010:

    Just what we need, people looking at their own well being rather than the well being of the nation. That said, it would be nice if the calculator were more flexible in picking the number of dependents, especially since $400 of credits are at stake regarding the Child Tax Credit.
    Out year calculations would also be nice, although they would be messy since some people don't get annual wage increases these days.

  2. Anonymous  ::  7:19 am on September 11th, 2010:

    I am very impressed. The calculator includes AMT, and it illustrates perfectly that for taxpayers in the AMT range, expiration of the tax cuts can be a virtual non-event. The Tentative Minimum Tax is the same either way, and the TMT sets a floor on tax liability.
    This is a superb effort. My congratulations to the implementers.
    If you folks are really ambitious, you could create another tool allowing the user to specify inputs the same way and show a graph of effective marginal tax rate vs. income, including all phase-outs of credits and deductions. Those graphs are usually surprisingly flat at a rate of 40% or so.

  3. Anonymous  ::  3:16 am on September 13th, 2010:

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  4. Anonymous  ::  10:32 pm on September 13th, 2010:

    The calculator probably ought to display 2 results: One with the AMT patched and (the one it displays now) with the AMT unpatched. Without the patch, about 15 million people will see a large tax increase with or without extension of the tax cuts. I trust that illustrating that somewhat misleading point without explanation was not the objective of this calculator!

  5. Anonymous  ::  5:03 pm on September 14th, 2010:

    Does all of this 'calculation' take into account all of those working people (White House, IRS employees) who should pay their fed income taxes but don't? I would think that would change your pie chart.

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  7. Anonymous  ::  6:29 pm on September 27th, 2010:

    This calculator is highly misleading and makes me question your evenhandedness. It incorporates an AMT patch for the Obama 2011 scenario, but doesn't for the 2001-2003 tax cuts in effect scenario. This makes it look like the Obama 2011 scenario is a great deal better for many people caught in AMT land, but the AMT patch is likely to happen whether or not Obama 2011 happens.

  8. Anonymous  ::  6:41 pm on September 27th, 2010:

    The calculator portrays each policy alternative accurately. There is currently no AMT patch in either 2010 law or the law that would apply if the 2001-03 tax cuts expire as scheduled. The president's budget plan includes a permanent AMT patch. All three policy options are described in detail at http://www.taxpolicycenter.org/numbers/displayatab.cfm?DocID=2782
    We recognize that people might want to modify the AMT provisions and will therefore make that option available in the next version of the calculator, which we are working on now.

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