High-income tax returns for 2000

High-income tax returns for 2000

Brian Balkovic

The Tax Reform Act of 1976 requires annual publication of data on individual income tax returns reporting income of $200,000 or more, including the number of such returns reporting no income tax liability and the importance of various tax provisions in making these returns nontaxable [1]. This article presents detailed data for the 2.8 million high-income returns for 2000, as well as summary data for the period 1977 to 2000. Detailed data for the years 1974 through 1999 have been published previously [2].

Two income concepts are used in this article to classify tax returns as high-income: the statutory concept of adjusted gross income (AGI) and the expanded income concept [3]. Expanded income uses items reported on tax returns to obtain a more comprehensive measure of income than AGI. Specifically, expanded income is AGI plus tax-exempt interest, nontaxable Social Security benefits, the foreign-earned income exclusion, and items of “tax preference” for “alternative minimum tax” purposes; less unreimbursed employee business expenses, moving expenses, investment interest expense to the extent it does not exceed investment income, and miscellaneous itemized deductions not subject to the 2-percent-of-AGI floor [4, 5]. Note that, although expanded income is a more comprehensive measure of income than AGI, for some taxpayers, the subtractions from AGI to arrive at expanded income exceed the additions, with the result that expanded income is less than AGI.

Number of High-Income Returns

Table 1 shows that, for 2000, there were 2,771,577 individual income tax returns reporting AGI of $200,000 or more, and 2,807,804 with expanded income of $200,000 or more. These returns represented, respectively, 2.142 percent and 2.170 percent of all returns for 2000.

Since 1977, the number of returns reporting income of $200,000 or more has increased at a much more rapid rate than the total number of returns filed. This pattern is true under both income concepts. Between 1999 and 2000, while the total number of tax returns increased 1.8 percent, the number of high AGI returns increased 14.1 percent, and the number of high expanded-income returns rose 13.2 percent. As a result, for each year, returns with income of $200,000 or more comprised a larger share of all returns than for the preceding year.

The difference in the number of high-income returns between the two income concepts significantly decreased beginning with 1987, when AGI began to include 100 percent of long-term capital gains. That change in the definition of AGI made the income concepts of AGI and expanded income more comparable. In addition, as a result of the inclusion of tax-exempt interest in expanded income starting with 1987, expanded income for years after 1986 is not strictly comparable to expanded income for years before 1987.

In the top panel of Figure A, the $200,000 threshold for high-income returns is measured in current-year (nominal) dollars. As a result of inflation, the real (constant) dollar level of the threshold fell over time, and some returns are classified as high-income that would not have been classified as high-income for earlier years. To maintain the comparability of the real threshold over time, the nominal $200,000 threshold has been adjusted for inflation to 1976 constant dollars for all years, and the number of high-income tax returns has been recomputed in the lower panel of Figure A [6].

When measured in 1976 constant dollars, under the expanded income concept, the total number of high-income returns for 2000 was only 8.4 times the number for 1977. However, the number of high-income returns for 2000 measured in current-year dollars was 41.6 times as large as for 1977. Since 1977, the percentage of returns with expanded income of $200,000 or more in current dollars increased every year. The share of high-expanded-income returns in 1976 constant dollars increased from 1999 to 2000, as it has for 7 years. For 2000, the share of high-expanded-income returns reached 0.381 percent, surpassing the preceding high of 0.351 percent, reached in 1999. Figure B shows the difference between the constant and current dollar shares of high-income returns.

Based on AGI, the number of high-income returns for 2000 measured in current-year dollars was 51.9 times as large as for 1977. Measured in 1976 constant dollars, the number of returns for 2000 was only 10.5 times the number for 1977. Between 1988 and 1994, the share of such returns fell from 0.214 percent to 0.176 percent of all returns, before increasing each year from 1995 through 2000 to reach 0.373 percent for 2000. As for high-expanded-income returns, the 2000 share was a new high, surpassing the previous high of 0.351 percent reached in 1999.

Nontaxable High-Income Returns

Two tax concepts are used in this article to classify tax returns as taxable or nontaxable. The first concept, “U.S. income tax,” is total Federal income tax liability (including the “alternative minimum tax” (AMT)), less all credits against income tax. Since the U.S. income tax applies to worldwide income and since a credit (subject to certain limits) is allowed against U.S. income tax for income taxes paid to foreign governments, a return could be classified as nontaxable under this first concept even though income taxes had been paid to a foreign government. The second tax concept, “worldwide income tax,” addresses this circumstance by adding to U.S. income tax the allowed foreign tax credit and foreign taxes paid on excluded foreign-earned income [7, 8].

For 2000, of the 2,771,577 income tax returns with AGI of $200,000 or more, 2,328 (0.084 percent) showed no U.S. income tax liability; and 2,022 (0.073 percent) showed no worldwide income tax liability (the top panel of Figure C). For 1999, there were 1,605 returns (0.067 percent) with AGI of $200,000 or more with no U.S. income tax liability; and 1,398 returns (0.058 percent) with no worldwide income tax liability.

Of the 2,807,804 tax returns with expanded income of $200,000 or more, some 2,766 (0.099 percent) had no U.S. income tax liability; and 2,320 (0.083 percent) had no worldwide income tax liability [9]. Of the 2,479,556 returns with expanded income of $200,000 or more for 1999, there were 2,525 (0.102 percent) with no U.S. income tax liability and 2,174 (0.088 percent) with no worldwide income tax liability.

Thus, whether measured by absence of U.S. income tax or absence of worldwide income tax, the proportion of nontaxable high-AGI returns increased between 1999 and 2000, but the proportion of nontaxable high-expanded-income returns decreased.

Although the number of nontaxable, high-expanded-income returns, as measured by absence of U.S. income tax, increased in all but a few years since 1977, that increase largely was attributable to the growth in the overall number of all returns–taxable and nontaxable–with income of $200,000 or more. As mentioned previously, because of the inclusion of tax-exempt interest in expanded income starting with 1987, the concept of expanded income is no longer strictly comparable to expanded income calculated for years before 1987 [10].

Regardless of the income measure (AGI or expanded income) or the tax concept (U.S. income tax or worldwide income tax) used, the numbers of 2000 nontaxable, high-income returns in 1976 constant dollars were much lower than the numbers in current dollars. The percentages of nontaxable returns are not substantially different regardless of whether measured in constant or current dollars. Of returns with AGI of $200,000 or more in current dollars, 0.084 percent reported no U.S. income tax for 2000; and 0.073 percent had no worldwide income tax. For returns in 1976 constant dollars, the percentage without U.S. income tax liability was 0.096; the percentage without worldwide income tax liability was 0.081 (see the lower panel of Figure C).

Of returns with expanded income of $200,000 or more in current dollars, 0.099 percent reported no U.S. income tax; and 0.083 percent reported no worldwide income tax. When looking at these same returns using 1976 constant dollars, the percentage without U.S. income tax liability was 0.074; the percentage without worldwide income tax liability was 0.059.

Figure D shows the number of returns with no worldwide income tax and with expanded income of $200,000 or more and their proportion of all high income returns for 1977 through 2000. These data are shown in both current-year and 1976 constant dollars. In this figure, the spread between the two percentage lines was small for the late 1970’s, showed an increase for the early 1980’s, and then narrowed before widening again after 1988. The spread also narrowed from 1994 through 1997 and then slightly increased for 1998 and 1999. For 2000, the spread narrowed slightly.

Note that, because the number of nontaxable returns with expanded income of $200,000 or more is based on samples, year-to-year differences in the numbers and percentages of nontaxable returns with expanded income of $200,000 or more may represent sampling variability, in addition to actual changes in the numbers of such returns. Beginning with Tax Year 1991, nontaxable returns with expanded income of $200,000 or more were sampled at higher rates for Statistics of Income, which reduced the sampling variability of these returns and therefore provided improved estimates. Thus, the data for returns prior to 1991 are not entirely comparable with data for more recent years.

Detailed Data for 2000

Tables 1 through 12 present data based on income tax returns for 2000, mainly those with income of $200,000 or more (measured in current-year dollars) of AGI or expanded income. Most of the data are shown for taxable and nontaxable returns, both separately and combined. In summary, the tables show:

* The numbers of returns under the two tax concepts, cross-classified by broad AGI and expanded income-size classes (Tables 1 and 2);

* The distributions of taxable income as a percentage of AGI and expanded income (Tables 3 and 4);

* The frequencies and amounts of various sources of income, exclusions, deductions, taxes, and tax credits, as well as the relationship between the two income concepts (Tables 5 and 6);

* The frequencies with which various deductions and tax credits are the most important and second most important items in reducing (or eliminating) income tax (Tables 7 and 8);

* The frequencies with which various itemized deductions, tax credits, and tax preference items occur as certain percentages of income (Tables 9 and 10); and

* The distributions of effective tax rates, i.e., income tax under each definition as a percentage of income, by broad income-size classes (Tables 11 and 12).

Tables 1,3,5,7,9, and 11 use the U.S. income tax concept to classify returns as taxable or nontaxable, whereas Tables 2, 4, 6, 8, 10, and 12 use the worldwide income tax concept.

Size of Income

Tables 1 and 2 show the number of all returns, taxable returns, and nontaxable returns, cross-classified by broad AGI and expanded income-size classes. The tables show that most returns fall in the same broad income-size class under both income concepts, but that the number of nontaxable returns is greater in each income class over $50,000 when income is measured by economic income rather than by AGI. Table 1 shows that 2,328 returns with no U.S. income tax had an AGI of $200,000 or more; and 2,766 returns with no U.S. income tax had an expanded income of $200,000 or more.

Distribution of Tax Levels

Tables 3 and 4 show the distributions of high-income returns by the ratios of “adjusted” taxable income to AGI or expanded income. Taxable income has been “adjusted” for these tables by subtracting from taxable income the deduction equivalents of tax credits and other items [11]. Thus, the tables show the extent to which AGI or expanded income, respectively, are reduced before taxes are imposed on the remaining income. The tables also illustrate three important facts about high-income tax returns. (The examples in the paragraphs below are drawn from the “expanded income” columns in Table 4.)

* As already described, only a small portion of high-income taxpayers were able to escape all income taxes (0.090 percent, which is rounded to 0.1 percent in Table 4).

* Another group of high-income taxpayers–small, but larger than the nontaxable group–was able to offset a very substantial fraction of its income before being subject to tax. This type of high-income taxpayer pays income tax equal to only a small share of his or her income. Such taxpayers may be called “nearly nontaxables.” (Around 0.5 percent of high-expanded-income taxpayers reported some tax liability, but were able to reduce their taxable incomes to less than 25 percent of their expanded incomes.)

* Overall, a large portion of high-income taxpayers were subject to tax on a large share of their incomes and, consequently, reported very substantial amounts of tax. (60.2 percent had taxable income equal to 80 percent or more of expanded income; and 96.9 percent had taxable income equal to 50 percent or more of expanded income.)

Tables 11 and 12 show the distributions of tax returns in another way: by tax burden. These two tables classify all tax returns by both size of income and effective tax rate, i.e., income tax as a percentage of either adjusted gross income or expanded income. These tables show that, on average, high-income taxpayers did have higher effective tax rates. The tables also illustrate the wide dispersion of effective tax rates for high-income returns. For example, Table 12 shows that, while 1.2 percent of returns with expanded income of $200,000 or more had either no worldwide income tax or worldwide income tax of less than 10 percent of expanded income, 43.2 percent had effective tax rates of 25 percent or more. In addition, 78.2 percent of high-income taxpayers had average tax rates ranging from 20 percent to 35 percent, while 38.3 percent had effective tax rates between 20 percent and 25 percent.

Characteristics of Tax Returns

Tables 5 and 6 show, in the aggregate, the frequencies and amounts of the types of income, the items of tax preference, and the various deductions, credits, and income taxes shown on high-income returns. By comparing the columns for nontaxable returns with those for taxable returns, some of the different characteristics of nontaxable returns can be deduced. For example, nontaxable returns under the expanded-income concept were much more likely to have tax-exempt interest than were taxable returns, and when they did have it, the average amount was much higher. Similarly, nontaxable returns were much less likely to have any income from salaries and wages.

Reasons for Nontaxability

It is possible for certain itemized deductions and certain exclusions from income to cause nontaxability by themselves, but high-income returns are more often nontaxable as a result of a combination of reasons, none of which, by itself, would result in nontaxability. Moreover, some items, which singly or in combination may eliminate “regular tax” liability, i.e., income tax excluding the alternative minimum tax (AMT), cannot eliminate an AMT liability, since these items give rise to adjustments or preferences for AMT purposes.

Because they do not generate AMT adjustments or preferences, tax-exempt bond interest, itemized deductions for interest expense, miscellaneous itemized deductions not subject to the 2-percent-of-AGI floor, casualty or theft losses, and medical expenses (exceeding 10 percent of AGI) could, by themselves, produce nontaxability [12].

Due to the AMT exclusion of $45,000 on joint returns ($33,750 on single and head-of-household returns and $22,500 on returns of married taxpayers filing separately), a return could have been nontaxable, even though it included some items that produced AMT adjustments or preferences [13]. Further, since the starting point for “alternative minimum taxable income” was taxable income for regular tax purposes, a taxpayer could have adjustments and preferences exceeding the AMT exclusion without incurring AMT liability. This situation could occur if taxable income for regular tax purposes was sufficiently negative, due to itemized deductions and personal exemptions exceeding AGI, so that the taxpayer’s AMT adjustments and preferences are less than the sum of the AMT exclusion and the amount by which regular taxable income is below zero. Note that, because of the AMT, taxpayers may have found it beneficial to report additional deduction items on their tax returns, even if the items did not produce a benefit for regular tax purposes.

Tables 7 and 8 classify tax returns by the items that had the largest and second largest effects in reducing or eliminating income tax. For returns on which each of the largest effects was identified, the tables show each of the second largest effects [14]. For example, Table 7 shows that, on taxable returns with some U.S. income tax and expanded income of $200,000 or more, the taxes paid deduction was the most important item 50.8 percent of the time. Where this was the primary item, the interest paid deduction was the second most important item 59.2 percent of the time, and the charitable contributions deduction was the third most important item 26.7 percent of the time.

Table 8 shows that, on returns without any worldwide tax and expanded income of $200,000 or more, the most important item in reducing the tax, reported on 52.5 percent of the returns, was the exclusion for State and local government interest (“tax-exempt interest”). For these returns, the itemized deduction for medical and dental expense was the second most important item 28.4 percent of the time, and the deduction for taxes paid was the second most important item 25.0 percent of the time.

The four categories with the largest effect in reducing taxes on high adjusted-gross-income returns with no worldwide income tax were the investment interest expense deduction (681 returns or 34.2 percent of the 1,993 tabulated returns with AGI of $200,000 or more and with no worldwide tax liability); total miscellaneous deductions (421 returns or 21.1 percent); partnership and S corporation net losses (191 returns or 9.6 percent); and the medical and dental expense deduction (176 returns or 8.8 percent). These effects are also shown graphically in Figure E.

The four categories that most frequently had the largest effect in reducing taxes for high expanded-income returns with no worldwide income tax were tax-exempt interest (1,219 returns or 52.5 percent of the 2,320 tabulated returns with expanded income of $200,000 or more and with no worldwide tax liability); the medical and dental expense deduction (357 returns or 15.4 percent); all other tax credits (214 returns or 9.2 percent); and partnership and S corporation net losses (190 returns or 8.2 percent). These effects are also shown graphically in Figure F. Table 8 also shows the two items that most frequently had the second largest effect in reducing regular tax liability for high expanded-income returns with no worldwide tax. These were the deduction for taxes paid (458 returns or 19.7 percent) and the deduction for medical and dental expenses (397 returns or 17.1 percent).

Tables 9 and 10 present another way of illustrating the importance of various tax provisions in reducing or eliminating income tax. Unlike Tables 7 and 8, these tables cover only nontaxable returns, i.e., returns showing no income tax liability, including AMT. Tables 9 and 10 show the number of times that various items reduced income by different fractions of income. The items shown are the various categories of itemized deductions, the deduction equivalents of two different types of tax credits, and total tax preferences excluded from income. For example, for high-expanded-income returns with no worldwide income tax (Table 10), the itemized deduction for casualty or theft losses exceeded 100 percent of expanded income on 78 of the 2,320 returns, but there was no casualty or theft loss deduction on 2,210 returns.

U.S. Department of Treasury, Internal Revenue Service, Statistics of Income–Individual Income Tax Returns for 1977 through 1982 and 1985 through 1988. (For 1977 and 1978, only the number of nontaxable, high-AGI returns was published.)

Lerman, Allen H., “High-Income Tax Returns, 1983,” Statistics of Income Bulletin, Spring 1986, Volume 5, Number 4, pp. 31-61; “High-Income Tax Returns, 1984,” Statistics of Income Bulletin, Spring 1987, Volume 6, Number 4, pp. 1-29; “High-income Tax Returns for 1989,” Statistics of Income Bulletin, Spring 1993, Volume 12, Number 4, pp. 23-50; “High-Income Tax Returns for 1990,” Statistics of Income Bulletin, Winter 1993-1994, Volume 13, Number 3, pp. 104-132; “High-income Tax Returns for 1991,” Statistics of Income Bulletin, Winter 1994-1995, Volume 14, Number 3, pp. 96-130; and “High-income Tax Returns for 1992,” Statistics of Income Bulletin, Winter 1995-1996, Volume 15, Number 3, pp. 46-82;

Latzy, John, “High-income Tax Returns for 1993,” Statistics of Income Bulletin, Winter 1996-1997, Volume 16, Number 3, pp. 64-101; and “High-Income Tax Returns, 1994,” Statistics of Income Bulletin, Winter 1997-1998, Volume 17, Number 3, pp. 31-69;

Cruciano, Therese, “High-Income Tax Returns for 1995,” Statistics of Income Bulletin, Summer 1998, Volume 18, Number 1, pp. 69-108; “High-Income Tax Returns for 1996,” Statistics of Income Bulletin, Winter 1998-1999, Volume 18, Number 3, pp. 7-59.

Parisi, Michael, “High-Income Tax Returns for 1997,” Statistics of Income Bulletin, Winter 1999-2000, Volume 19, Number 3, pp. 6-58.

Balkovic, Brian, “High-Income Tax Returns for 1998,” Statistics of Income Bulletin, Winter 2000-200l, Volume 20, Number 3, pp. 5-57; “High-income Tax Returns for 1999,” Statistics of Income Bulletin, Spring 2002, Volume 21, Number 4, pp. 7-58.

[3] The 1976 Act specified four income concepts for classifying tax returns: adjusted gross income (AGI), expanded income, AGI plus excluded tax preference items, and AGI less investment interest expense not in excess of investment income. Section 441 of the Deficit Reduction Act of 1984 (90 Stat. at 815) eliminated the requirement to use the last two income concepts.

[4] The definition of adjustments to AGI to obtain the expanded income given in the text is for 1999. See Appendix A for a discussion of AGI and expanded income and a list of adjustments covering all years since 1977.

[5] See Notes to Appendix A, Note A4.

[6] Inflation-adjusted constant dollars are based on the Consumer Price Index (CPI-U) computed and reported by the U.S. Department of Labor, Bureau of Labor Statistics, Monthly Labor Review. The consumer price index represents annual averages of monthly indices and approximates buying patterns of typical urban consumers.

[7] See Appendix B for a discussion of the tax concepts. In data published for years prior to 1989, either in articles presented in the Statistics of Income Bulletin or in chapters in Statistics of Income–Individual Income Tax Returns (see footnote 2), the “U.S. income tax” concept was described as “total income tax,” and the “worldwide income tax” concept was described as “modified total income tax.”

[8] The inclusion of foreign taxes paid on excluded foreign-earned income, beginning with Tax Year 1990, represents an improvement in the worldwide income tax concept. It does, however, represent a slight break in the year-to-year comparability of data for worldwide income tax. However, the number of returns with foreign taxes paid on excluded foreign-earned income is extremely small compared to the number of returns with the foreign tax credit.

[9] Includes returns on which income tax was entirely offset by the earned income credit.

[10] Tax-exempt interest had to be reported on the individual income tax return, starting with Tax Year 1987, and is included in expanded income starting with that year. Beginning with Tax Year 1991, tax-exempt interest was incorporated into the criteria used for sampling returns for Statistics of Income, thus increasing the reliability of the estimates of expanded income.

[11] See Appendix B for a description of how the deduction equivalent of credits was computed.

[12] The deduction for charitable contributions could also fall into this class if it were not limited to 50 percent of AGI.

[13] The AMT exclusion phases out above certain levels of “alternative minimum taxable income,” based on filing status, but since taxpayers will have some AMT liability in the phaseout range, the phaseout income is not relevant for nontaxable, high-income returns.

[14] Tax-exempt interest and the foreign-earned income exclusion were not included in Tables 7 and 8 as possible tax effects before Tax Year 1994. Thus, caution should be exercised in making comparisons between data prior to 1994 and after 1993.

Appendix A: Income Concepts

Congress wanted data on high-income taxpayers classified by an income concept that was more comprehensive than adjusted gross income (AGI), but that was based entirely on items already reported on income tax returns. In order to derive such an income concept, it was necessary to begin with a broad, inclusive concept of income. AGI must then be compared to this broad income concept, and the differences (both additions and subtractions) that can be determined from items reported on tax returns identified.

This appendix begins by defining “Haig-Simons income,” a very broad concept of income used by economists and others as a standard. AGI is then compared to Haig-Simons income, and the major differences between the two income concepts are listed. The final section defines “expanded income,” a more comprehensive income measure than AGI, based entirely on tax return data.

Haig-Simons Income

The broadest measure of annual income generally used by economists and others is defined as the value of a household’s consumption plus the change, if any, in its net worth. This income concept is referred to as Haig-Simons income, or H-S income, after the two economists who wrote extensively about it [A1]. The H-S income of a household that consumed $25,000 and saved $2,000 in a year would be $27,000. Alternatively, the H-S income of a household that consumed $25,000 and had no additions to savings, but had assets that declined in value by $1,000 in a year, would be $24,000.

H-S income consists of three broad components: labor income, capital income (income from assets), and income from transfer payments. The major elements of each of these three components are as follows:

* Labor income.–This includes all forms of employee compensation (including wages and salaries), employee fringe benefits (such as employer-provided health insurance and accrued pension benefits or contributions), and the employer share of payroll taxes (such as Social Security taxes). Labor income also includes the labor share of self-employment income. Expenses of earning labor income would be deducted in arriving at H-S income. Deferred labor income (such as pension benefits) would be counted in the year it was earned, rather than in the year it was received.

* Capital income.–This includes all income from assets, including interest, dividends, rents, royalties, accrued capital gains (whether or not realized), the capital income share of self-employment income, and the rental value of consumer durables (most importantly, the rental value of owner-occupied housing). Capital income is measured in real (inflation-adjusted) terms and is net of real, economic depreciation and all other expenses (which could exceed capital income).

* Transfer payments.–These include payments in cash (such as Social Security benefits, workers’ compensation, unemployment benefits, Aid to Families with Dependent Children (AFDC), and noncash benefits (such as Medicare, Medicaid, and food stamps).

For purposes of tax analysis, H-S income should be measured on a pre-tax basis, the amount that would be earned if there were no Federal income tax in place. Most items of income are unaffected, or little affected, by the income tax and so are reported on a pre-tax basis. However, certain income items from tax-preferred sources may be reduced because of their preferential treatment. An example is interest from tax-exempt State and local government bonds. The interest rate on tax-exempt bonds is generally lower than the interest rate on taxable bonds of the same maturity and risk, with the difference approximately equal to the tax rate of the typical investor in tax-exempt bonds. Thus, investors in tax-exempt bonds are effectively paying a tax, referred to as an “implicit tax,” and tax-exempt interest as reported is measured on an after-tax, rather than a pre-tax, basis. Income from all tax-preferred sources should be “grossed up” by implicit taxes to properly measure H-S income.

Adjusted Gross Income

AGI is the statutory definition of income for Federal income tax purposes. AGI differs from H-S income by excluding some components of H-S income and by allowing accelerated business deductions and deductions unrelated to income, but also by disallowing or limiting certain expenses of earning income and certain losses. In addition, AGI is not “grossed up” for implicit taxes.

The components of H-S income excluded from AGI include most employee fringe benefits, the employer share of payroll taxes, accrued but deferred employee compensation, accrued but unrealized real capital gains, the rental value of consumer durables, most Social Security benefits, most other cash transfers, all noncash transfers, and the real income of borrowers due to inflation [A2].

Depreciation and certain other expenses allowed in determining AGI may be accelerated (relative to economic depreciation and other costs) in the early years of an investment, thus understating investment income. In later years, however, investment income in AGI will be overstated because depreciation and other accelerated expenses will then be understated. AGI also excludes some expenses not related to earning income, such as contributions to self employed retirement (Keogh) plans, deductible contributions to Individual Retirement Arrangements (IRA’s), the portion of Social Security contributions for self-employed workers that is analogous to the employer share of such contributions for employees, and contributions to medical savings accounts. AGI generally exceeds H-S income to the extent that expenses of earning income and losses are limited or disallowed. Most of the expenses of earning income are deductible from AGI in calculating taxable income, but only if the taxpayer “itemizes” deductions and then, in some cases, only to the extent that the sum of all such items exceeds 2 percent of AGI. Expenses incurred in the production of income that are itemized deductions include certain expenses of employees (such as union dues; expenditures for items used on the job but not reimbursed by the employer; and the employees’ travel, meal, and entertainment expenses); and expenses attributable to a taxpayer’s (passive) investments (as opposed to active participation in a trade or business, for example), including, but not limited to, interest expense incurred in connection with investments in securities [A3]. Note that there are limits on certain types of deductible expenses. In particular, deductible meal and entertainment expenses are limited to 50 percent of total meal and entertainment expenses.

Although net capital losses reduce economic income, only the first $3,000 of net realized capital losses may be deducted in computing AGI. Any additional realized losses must be carried forward to future years. In a somewhat similar manner, “passive” losses (from investments in a trade or business in which the taxpayer does not materially participate) can also reduce economic income, but, in computing AGI, they can only be deducted from “passive” income from other, similar investments (although a larger amount may be deducted when the losses are from rental real estate activities).

AGI can also exceed H-S income because of differences in the timing of income between the two concepts. For example, a taxpayer may realize more capital gains in a year than he or she accrues in capital gains. Since AGI includes only realizations of capital gains, whereas H-S income includes only accruals, AGI in this circumstance would exceed HS income.

Finally, just as AGI understates the income of borrowers due to inflation, it overstates the income of lenders, who include bond owners and owners of bank deposits.

Expanded Income

Expanded income is meant to be a measure of income that is conceptually closer to H-S income than AGI, but which is derived entirely from items already reported on income tax returns. Figure G shows the adjustments made to AGI to arrive at expanded income. Since the definition of AGI was changed by legislation several times since 1977, and certain reporting requirements also changed, the adjustments differ over the years, as indicated for each item [A4]. Most of these adjustments are relatively straightforward, but the adjustment for investment requires some explanation.

Investment Interest

In measuring H-S income, it would generally be appropriate to deduct all expenses incurred in the production of income, including those related to any income-producing investments, without limit. Investment expenses in excess of investment income would then represent net economic losses. However, such a liberal deduction for investment-related expenses is not necessarily correct when not all income items have been included currently. (Investment income includes interest, dividends, and capital gains.)

If all income has not been included currently, full deduction of investment expenses might represent a mismatching of receipts and expenses and might result in understating income. For example, if a taxpayer borrowed funds to purchase securities, net income would be understated if the taxpayer deducted all interest payments on the loan, but did not include as income any accrued gains on the securities. A similar mismatching of income and expenses would occur if investment expenses that should properly be capitalized were deducted when paid. In these instances, a more accurate measure of income might be obtained by postponing the deduction of the expense until such time as the income were recognized for tax purposes.

Additional problems are created when a person with a loan has both income-producing assets, such as securities, and non-income-producing assets, such as a vacation home or yacht. It is not possible to determine what portion of the interest expense should be attributed to taxable income-producing assets and, therefore, ought to be deductible against the gross receipts from such taxable assets. As a result of these problems, it has been necessary to set arbitrary limits on the amount of investment expenses that are deductible in calculating expanded income.

Investment expenses that have not been deducted in determining AGI can generally appear on a Federal individual income tax return in two places. Investment interest expense is taken into account in the calculation of the itemized deduction for interest paid. Deductible investment interest expense is a separate part of the total interest deduction. Other investment expenses, such as management fees, are included in the miscellaneous category of itemized deductions [A8]. Beginning with 1987, most types of income-producing expenses included as miscellaneous itemized deductions are only deductible to the extent that their total exceeds 2 percent of AGI. To determine expenses that should be deductible in calculating an approximation of H-S income, investment expenses have been defined as deductible investment interest expense. Other investment expenses could not be separated from the remainder of miscellaneous deductions. Hence, they have not been used in the adjustment for investment expenses.

To the extent that interest expenses do not exceed investment income, they are generally allowed as a deduction in the computation of deductible investment interest expense and thus expanded income. Investment interest expenses that do exceed investment income are not deductible in calculating expanded income. One consequence of this definition is that investment expenses can never turn positive investment income into investment losses. Generally, allowing investment expenses to offset all investment income is generous and tends to understate broadly-measured income. However, in some instances, limiting investment expenses to investment income may overstate income by disallowing genuine investment losses.

Notes to Appendix A

[A1] Haig, Robert M. (editor) (1921), The Federal Income Tax, Columbia University Press, and Simons, Henry C. (1938), Personal Income Taxation, University of Chicago Press.

[A2] Borrowers receive income due to inflation because the real value of debt is reduced by inflation. Even though inflation may be anticipated and reflected in interest rates, tax deductions for nominal interest payments overstate interest costs because part of these payments represent a return of principal to the lender, rather than interest.

[A3] See Notes and References, footnote 4.

[A4] For 1977, 50 percent of net long-term capital gains were included in AGI. During 1978, the inclusion ratio was changed to 40 percent. This inclusion ratio remained unchanged through 1986. Beginning with 1987, there was no exclusion allowed for capital gains in computing AGI, and, thus, this adjustment was not made in computing expanded income for returns for years after 1986.

Beginning in 1987, taxpayers were required to report on their Federal income tax returns the amount of their tax-exempt interest incomes from State and local government bonds. Since 1987, tax-exempt interest has been included in expanded income.

Taxpayers are also required to report Social Security benefits. Since 1988, nontaxable Social Security benefits have been included in expanded income. However, if none of a particular taxpayer’s Social Security benefits are taxable, then gross Social Security benefits are not required to be shown on the income tax return. In such instances, which generally only affect lower- and middle-income taxpayers, Social Security benefits are not included in expanded income.

The subtraction of unreimbursed employee business expense and the moving expense deduction is to make the concept of expanded income comparable to years prior to 1987. All current-year moving expenses beginning with Tax Year 1994 were deducted in the calculation of AGI as a statutory adjustment.

Due to subtracting non-limited miscellaneous deductions and not subtracting the nondeductible rental loss for 1989, the expanded income concept for 1989 is not strictly comparable to expanded income for 1988. Nor is the expanded income concept for 1990 strictly comparable to expanded income for 1989 because of the addition of the foreign-earned income exclusion. Specific details on the definition of expanded income for any given year are available in the reports and publications enumerated in footnote 2, under Notes and References.

[A5] The “tax preferences” (obtained from Form 6251, Alternative Minimum Tax Computation) excluded from adjusted gross income and tabulated in Tables 5 and 6 include the following items: the excess of accelerated depreciation over straight-line depreciation on certain real property and property subject to a lease (for property placed in service before 1987); the appreciated portion of the value of certain property contributed to charitable organizations; the excess of percentage depletion over the “adjusted basis” of the property; certain intangible drilling costs to the extent that they exceed otherwise allowable amortization deductions; and related adjustments, refigured for AMT purposes, such as section 179 expense deductions, expenses for business or rental use of the home, taxable IRA distributions, etc.

Preferences obtained through itemized deductions do not represent omitted income. Hence, they have not been counted as preference items in calculating a broader measure of income. The preference from tax-exempt interest on certain private activity bonds was not included, since the interest for all tax-exempt State and local government bonds is considered to be omitted income. Specific details on the tax preference items obtained from Form 6251 for earlier years are available in the reports and publications enumerated in footnote 2, under Notes and References.

[A6] Includes deductible meal and entertainment expenses. Deductible expenses are limited to 50 percent of total meal and entertainment expenses, beginning with Tax Year 1994.

[A7] Certain moving expenses, such as expenses for temporary quarters and expenses for selling a former residence, are limited.

[A8] Some income deferrals and accelerated expense deductions may also be involved in income or losses from rental property, from royalties, from partnerships, and from S corporations, only the net amounts of which are included in adjusted gross income.

Appendix B: Tax Concepts

This appendix provides a brief summary of the U.S. taxation of worldwide income and the foreign tax credit. The two tax concepts used in this article are then defined. The following section explains the computation of the deduction equivalent of credits and other items. A final section discusses the possible implications of the use of unaudited tax return data for this article.

U.S. Taxation of Worldwide Income and the Foreign Tax Credit

Citizens and residents of the United States, regardless of where they physically reside, must generally include in income for Federal income tax purposes income from all geographic sources. Thus, for example, dividends and interest received from a foreign corporation or income earned working abroad is subject to Federal income tax in the same manner as income received from sources inside the United States [B1]. Income from sources outside the United States may also be subject to tax by foreign governments.

To reduce, if not eliminate, the possibility of double taxation of the foreign-source income of U.S. citizens and residents, the Federal income tax allows a credit for income taxes paid to foreign governments. This foreign tax credit is generally limited to the amount of (pre-credit) U.S. tax liability attributable to foreign-source income. This limit prevents the foreign tax credit from offsetting the U.S. tax on U.S.-source income.

As a result of taxing citizens and residents on a worldwide basis but allowing a foreign tax credit, some Federal income tax returns may report substantial income but little or no U.S. tax liability after credits. This may occur, for example, if a taxpayer has income only from foreign sources (the taxpayer may live abroad the entire year and have no income-producing assets in the United States), or if a taxpayer has foreign-source income that exceeds a net loss from U.S. sources and pays income taxes to a foreign government that are comparable to the U.S. tax [B2].

For taxpayers with income from foreign sources, these procedures understate the taxpayers’ true worldwide income tax liabilities and effective income tax rates. For such taxpayers, it does not seem appropriate to classify U.S. income tax credits for foreign tax payments as reducing tax liabilities. This is particularly true for tax filers who appear to be nontaxable because they do not have any U.S. tax liability, but who have paid foreign income taxes. A more accurate measure of overall income tax burden, as well as the numbers of nontaxable returns, can be obtained by considering all income taxes–U.S, as well as foreign. Thus, a second tax concept, worldwide income tax, has been used in addition to the traditional U.S. income tax.

Two Tax Concepts

Two tax concepts are used in this article to classify tax returns as taxable (i.e., returns showing an income tax liability) or nontaxable (i.e., returns showing no income tax liability) and to measure the tax burdens on taxable returns: U.S. income tax and worldwide income tax. Worldwide income tax is defined for purposes of this article as U.S. income tax plus the foreign tax credits reported on the U.S. income tax return and foreign taxes paid on excluded foreign-earned income (obtained from Form 1116, Foreign Tax Credit). The amount of the foreign tax credits and foreign taxes paid on excluded foreign-earned income is used as a proxy for foreign tax liabilities [B3]. The relationship of U.S. income tax to tax items reported on individual income tax returns, and to worldwide income tax, is shown in Figure H.

Comparing Exclusions, Deductions, Tax Credits, and Special Tax Computations

In order to compare the importance of various exclusions, deductions, tax credits, and special tax computations (such as the alternative minimum tax on tax preferences), the different types of items must be placed on the same basis. One way of doing so is to calculate the size of the deduction that would reduce (or increase) income tax by the same amount as a tax credit or special computation. This amount is called the “deduction equivalent” of the tax credit or special computation.

The deduction equivalent of a tax credit or a special tax computation is the difference between the taxable income that, using the ordinary tax rate schedules, would yield the actual tax before the provision in question is considered and the actual tax after the provision. For example, the “deduction equivalent of all tax credits” is equal to the difference between “taxable income that would yield income tax before credits” and “taxable income that would yield income tax after credits.”

Using this method of equating the value of deductions, exclusions, credits, and special tax computations, the order in which the various credits and special tax computations are calculated may affect the value of their deduction equivalents. Because the tax rate schedules are progressive, with successive increments to income taxed at successively higher tax rates, the deduction equivalent of the credit converted last to a deduction equivalent will be larger (for the same amount of a credit) than the item converted first, unless all relevant taxable income amounts are within a single tax-rate bracket.

The deduction equivalents of tax credits shown in Tables 9 and 10 were computed by assuming that deductions and exclusions reduce taxes before credits. As a result, the deduction equivalent of tax credits may be overstated.

Unaudited Data

Tax return data used for Statistics of Income have been tabulated as they were reported on tax returns filed with the Internal Revenue Service (IRS). Certain obvious arithmetic errors have been corrected and certain adjustments have been made to achieve consistent statistical definitions. Otherwise, the data have not been altered. In particular, the data do not reflect any changes that may have been or could be made as a result of IRS audits. While this is true of data throughout the entire Statistics of Income program, it is particularly relevant for high-income tax returns. Because of the greater complexity of these returns, there is a higher probability of error and more scope for disagreement about the proper interpretation of tax laws.

The fact that the data have been drawn from unaudited returns is of even greater importance for those high-income returns that are nontaxable. Almost any audit changes would make such returns taxable. Even where the tax consequences are minor, such returns could be reclassified from nontaxable to taxable, thereby changing the counts of nontaxable returns.’

Notes to Appendix B

[B1] An exception is that certain income earned abroad may be excluded from AGI. Any foreign taxes paid on such income are not creditable against U.S. income tax. The tables in this article include such excluded income in expanded income. Foreign taxes paid on such income are reflected in worldwide income tax, as discussed later.

[B2] Although the foreign tax credit is an item of tax preference for AMT purposes, taxpayers below the AMT exclusion thresholds, or with preferences or deductions not subject to AMT, could completely offset pre-credit U.S. income tax liability with foreign tax credits.

[B3] Where foreign tax rates exceed U.S. rates, foreign tax credits will be less than foreign tax liabilities. In such cases, using foreign tax credits as a proxy for foreign tax liabilities understates worldwide income tax liability. In other cases, when foreign tax credits are for taxes paid on income from previous years, use of foreign tax credits as a proxy may overstate or understate worldwide taxes on current-year income.

Table 1.–Returns With and Without U.S. Income Tax: Number of Returns,

by Size of Income Under Alternative Concepts, Tax Year 2000

[All figures are estimates based on samples]

Returns by size of

adjusted gross income

$50,000

Returns by tax status, All Under under

size of expanded income returns $50,000 (1) $100,000

(1) (2) (3)

All returns

Total 129,373,500 92,844,989 25,673,487

Under $50,000 (1) 92,241,597 91,661,678 571,010

$50,000 under $100,000 26,290,390 1,147,580 24,879,760

$100,000 under $200,000 8,033,709 33,444 217,096

$200,000 or more 2,807,804 2,287 5,621

Returns with U.S.

income tax

Total 100,165,434 63,776,794 25,541,521

Under $50,000 (1) 63,238,066 62,679,700 552,000

$50,000 under $100,000 26,109,775 1,077,598 24,769,584

$100,000 under $200,000 8,012,556 17,947 214,684

$200,000 or more 2,805,037 1,549 5,253

Returns without U.S.

income tax

Total 29,208,066 29,068,195 131,965

Under $50,000 (1) 29,003,531 28,981,978 19,009

$50,000 under $100,000 180,616 69,982 110,177

$100,000 under $200,000 21,153 15,497 2,412

$200,000 or more 2,766 738 368

Returns by size of

adjusted gross income

Returns by tax status, $100,000

size of expanded income under $200,000

$200,000 or more

(4) (5)

All returns

Total 8,083,447 2,771,577

Under $50,000 (1) 6,258 2,652

$50,000 under $100,000 260,332 2,718

$100,000 under $200,000 7,727,944 55,225

$200,000 or more 88,913 2,710,982

Returns with U.S.

income tax

Total 8,077,869 2,769,249

Under $50,000 (1) 4,578 1,788

$50,000 under $100,000 260,044 2,549

$100,000 under $200,000 7,724,941 54,983

$200,000 or more 88,306 2,709,929

Returns without U.S.

income tax

Total 5,578 2,328

Under $50,000 (1) 1,680 864

$50,000 under $100,000 288 169

$100,000 under $200,000 3,003 242

$200,000 or more 607 1,053

(1) Includes returns with adjusted gross deficit or with negative

expanded income.

NOTE: Detail may not add to totals because of rounding.

Table 2.–Returns With and Without Worldwide Income Tax: Number of

Returns, by Size of Income Under Alternative Concepts, Tax Year 2000

[All figures are estimates based on samples]

Returns by size of

adjusted gross income

50,000

Returns by tax status, All Under under

size of expanded income returns $50,000 (1) $100,000

(1) (2) (3)

All returns

Total 129,373,500 92,844,989 25,673,487

Under $50,000 (1) 92,241,597 91,661,678 571,010

$50,000 under $100,000 26,290,390 1,147,580 24,879,760

$100,000 under $200,000 8,033,709 33,444 217,096

$200,000 or more 2,807,804 2,287 5,621

Returns with worldwide

income tax

Total 100,223,593 63,825,894 25,549,654

Under $50,000 (1) 63,277,483 62,719,102 552,000

$50,000 under $100,000 26,120,092 1,081,663 24,775,673

$100,000 under $200,000 8,020,536 23,566 216,681

$200,000 or more 2,805,483 1,563 5,300

Returns without

worldwide income tax

Total 29,149,907 29,019,095 123,833

Under $50,000 (1) 28,964,115 28,942,576 19,009

$50,000 under $100,000 170,298 65,917 104,087

$100,000 under $200,000 13,173 9,878 415

$200,000 or more 2,320 724 321

Returns by size of

adjusted gross income

$100,000

Returns by tax status, under $200,000

size of expanded income $200,000 or more

(4) (5)

All returns

Total 8,083,447 2,771,577

Under $50,000 (1) 6,258 2,652

$50,000 under $100,000 260,332 2,718

$100,000 under $200,000 7,727,944 55,225

$200,000 or more 88,913 2,710,982

Returns with worldwide

income tax

Total 8,078,490 2,769,555

Under $50,000 (1) 4,578 1,803

$50,000 under $100,000 260,195 2,561

$100,000 under $200,000 7,725,290 54,999

$200,000 or more 88,428 2,710,192

Returns without

worldwide income tax

Total 4,957 2,022

Under $50,000 (1) 1,680 849

$50,000 under $100,000 137 157

$100,000 under $200,000 2,655 226

$200,000 or more 485 790

(1) Includes returns with adjusted gross deficit or with negative

expanded income.

NOTE: Detail may not add to totals because of rounding.

Table 3.–Returns With and Without U.S. Income Tax and With Income of

$200,000 or More Under Alternative Concepts: Distribution of Returns by

Ratio of Adjusted Taxable Income to Income Per Concept, Tax Year 2000

[All figures are estimates based on sample]

Adjusted gross income concept

Tax status, ratio of adjusted Cumulative

taxable income to income per Number of Percentage percentage

concept returns of total of total

(1) (2) (3)

Total 2,771,577 100.0 —

Returns without U.S. income tax 2,328 0.1 —

Returns with U.S. income tax:

Total 2,769,249 99.9 100.0

Ratio of adjusted taxable

income to income per concept:

Under 5 percent 1,260 (1) (1)

5 under 10 percent 1,653 0.1 0.1

10 under 15 percent 4,696 0.2 0.3

15 under 20 percent 6,191 0.2 0.5

20 under 25 percent 4,395 0.2 0.7

25 under 30 percent 4,791 0.2 0.8

30 under 35 percent 6,419 0.2 1.1

35 under 40 percent 8,982 0.3 1.4

40 under 45 percent 13,728 0.5 1.9

45 under 50 percent 25,920 0.9 2.8

50 under 60 percent 112,710 4.1 6.9

60 under 70 percent 257,884 9.3 16.2

70 under 80 percent 638,927 23.1 39.3

80 percent or more 1,681,693 60.7 100.0

Expanded income concept

Tax status, ratio of adjusted Cumulative

taxable income to income per Number of Percentage percentage

concept returns of total of total

(4) (5) (6)

Total 2,807,804 100.0 —

Returns without U.S. income tax 2,766 0.1 —

Returns with U.S. income tax:

Total 2,805,037 99.9 100.0

Ratio of adjusted taxable

income to income per concept:

Under 5 percent 2,036 0.1 0.1

5 under 10 percent 7,304 0.3 0.3

10 under 15 percent 7,847 0.3 0.6

15 under 20 percent 6,796 0.2 0.9

20 under 25 percent 8,055 0.3 1.1

25 under 30 percent 8,931 0.3 1.5

30 under 35 percent 12,059 0.4 1.9

35 under 40 percent 14,403 0.5 2.4

40 under 45 percent 20,027 0.7 3.1

45 under 50 percent 31,048 1.1 4.2

50 under 60 percent 132,914 4.7 9.0

60 under 70 percent 272,903 9.7 18.7

70 under 80 percent 632,409 22.5 41.2

80 percent or more 1,648,304 58.8 100.0

(1) Less than 0.05 percent.

NOTE: Detail may not add to totals because of rounding.

Table 4.–Returns With and Without Worldwide Income Tax and With Income

of $200,000 or More Under Alternative Concepts: Distribution of Returns

by Ratio of Adjusted Taxable Income to Income Per Concept, Tax Year

2000

[All figures are estimates based on samples]

Adjusted gross income concept

Tax status, ratio of Cumulative

adjusted taxable income to Number of Percentage percentage

income per concept returns of total of total

(1) (2) (3)

Total 2,771,577 100.0 —

Returns without worldwide

income tax 2,022 0.1 —

Returns with worldwide

income tax:

Total 2,769,555 99.9 100.0

Ratio of adjusted taxable

income to income per

concept:

Under 5 percent 1,307 (1) (1)

5 under 10 percent 1,227 (1) 0.1

10 under 15 percent 1,237 (1) 0.1

15 under 20 percent 2,777 0.1 0.2

20 under 25 percent 2,389 0.1 0.3

25 under 30 percent 3,350 0.1 0.4

30 under 35 percent 4,840 0.2 0.6

35 under 40 percent 7,235 0.3 0.9

40 under 45 percent 11,570 0.4 1.3

45 under 50 percent 23,352 0.8 2.1

50 under 60 percent 109,196 3.9 6.1

60 under 70 percent 253,086 9.1 15.2

70 under 80 percent 637,522 23.0 38.2

80 percent or more 1,710,467 61.8 100.0

Expanded income concept

Tax status, ratio of Cumulative

adjusted taxable income to Number of Percentage percentage

income per concept returns of total of total

(4) (5) (6)

Total 2,807,804 100.0 —

Returns without worldwide

income tax 2,320 0.1 —

Returns with worldwide

income tax:

Total 2,805,483 99.9 100.0

Ratio of adjusted taxable

income to income per

concept:

Under 5 percent 1,755 0.1 0.1

5 under 10 percent 2,284 0.1 0.1

10 under 15 percent 1,855 0.1 0.2

15 under 20 percent 2,919 0.1 0.3

20 under 25 percent 4,715 0.2 0.5

25 under 30 percent 5,761 0.2 0.7

30 under 35 percent 8,124 0.3 1.0

35 under 40 percent 11,380 0.4 1.4

40 under 45 percent 18,643 0.7 2.0

45 under 50 percent 28,379 1.0 3.1

50 under 60 percent 128,896 4.6 7.7

60 under 70 percent 270,674 9.6 17.3

70 under 80 percent 632,588 22.5 39.8

80 percent or more 1,687,511 60.2 100.0

(1) Less than 0.05 percent.

NOTE: Detail may not add to totals because of rounding.

Table 5.–Returns With and Without U.S. Income Tax and With Income of

$200,000 or More Under Alternative Concepts: Income, Deductions,

Credits, and Tax, by Tax Status, Tax Year 2000

[All figures are estimates based on samples–money amounts are in

thousands of dollars]

Returns with income of

$200,000 or more

Total

Number

Income concept, item of Amount

returns

(1) (2)

Adjusted Gross Income Concept

Salaries and wages 2,352,979 760,306,710

Business or profession:

Net income 562,681 61,575,811

Net loss 158,366 3,757,912

Farm:

Net income 19,268 839,357

Net loss 54,570 2,265,169

Partnership and S corporation net income

after Section 179 property deduction: (1)

Net income 927,967 218,456,954

Net loss 280,727 28,998,667

Sales of capital assets:

Net gain 1,825,634 483,299,019

Net loss 554,201 1,385,047

Sales of property other than capital

assets:

Net gain 114,999 2,744,249

Net loss 182,809 2,653,820

Taxable interest received 2,680,970 65,705,360

Tax-exempt interest 906,558 29,957,271

Dividends 2,435,120 65,725,967

Pensions and annuities in adjusted

gross income 559,903 22,009,036

Rent:

Net income 401,606 16,937,036

Net loss, total (deductible and

nondeductible) 318,162 3,784,696

Nondeductible rental loss 201,932 2,006,830

Royalty:

Net income 128,985 4,233,200

Net loss 5,751 34,929

Estate or trust:

Net income 93,409 8,093,651

Net loss 9,664 575,303

State income tax refunds 1,269,273 5,872,538

Alimony received 6,499 802,815

Social Security benefits in adjusted

gross income 458,060 7,405,086

Social Security benefits (nontaxable) 458,060 1,306,883

Unemployment compensation 33,448 138,577

Other income 435,894 13,725,468

Other loss 33,470 1,676,044

Foreign-earned income exclusion 26,829 1,905,153

Total income 2,771,577 1,714,078,654

Statutory adjustments, total 1,126,014 13,888,081

Payments to Individual Retirement

Arrangements 119,927 395,344

Payments to self-employed retirement

(Keogh) plans 306,668 5,860,230

Moving expenses adjustment 34,590 196,185

Adjusted gross income 2,771,577 1,700,190,573

Investment interest expense deduction 658,321 17,672,421

Total tax preferences excluded from

adjusted gross income 916,100 30,367,235

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 20,252 417,458

Passive activity loss (alternative

minimum tax adjustment) 337,622 1,239,876

Expanded income 2,771,497 1,707,504,614

Exemption amount 1,409,449 6,671,119

Itemized deductions:

Total per adjusted gross income concept 2,574,851 193,207,138

Charitable contributions deduction 2,473,540 55,421,387

Interest paid deduction:

Total per adjusted gross income concept 2,159,726 56,857,204

Total home mortgage interest 2,011,675 39,014,374

Medical and dental expense deduction 33,412 1,179,974

Net casualty or theft loss deduction 2,370 205,128

Taxes paid deduction 2,565,156 102,690,477

Net limited miscellaneous deductions per

adjusted gross income concept 418,857 7,741,812

Non-limited miscellaneous deductions 74,758 4,325,788

Excess of exemptions and deductions

over adjusted gross income 4,173 1,283,962

Taxable income 2,767,332 1,500,199,314

Tax at regular rates 2,767,422 447,889,876

Alternative minimum tax (Form 6251) 519,149 7,499,588

Income tax before credits 2,769,843 455,315,830

Tax credits:

Total 1,038,199 6,622,389

Child care credit 157,337 76,155

Minimum tax credit 81,489 1,165,584

Foreign tax credit 823,436 4,840,559

General business credit 70,241 424,498

U.S. total income tax 2,769,249 448,796,311

Taxable income which would yield:

Income tax before credits 2,769,843 1,321,808,711

Income tax after credits 2,769,085 1,304,467,665

U.S. total income tax 2,769,249 1,304,756,792

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,771,577 1,700,190,573

plus: Total tax preferences

excluded from adjusted

gross income [2] 916,100 30,367,235

Social Security benefits

(nontaxable) 458,060 1,306,883

Foreign-earned income exclusion 26,829 1,905,153

minus: Investment interest

expense deduction 658,321 17,672,421

Non-limited miscellaneous

deductions 74,758 4,325,788

Unreimbursed employee

business expenses 516,819 4,267,020

Equals: Expanded income 2,771,497 1,707,504,614

Expanded Income Concept

Salaries and wages 2,348,637 758,447,567

Business or profession:

Net income 568,366 61,933,228

Net loss 155,397 3,730,317

Farm:

Net income 19,516 884,333

Net loss 54,665 2,256,433

Partnership and S corporation net income

after Section 179 property deduction: (1)

Net income 934,960 218,364,955

Net loss 286,224 28,758,374

Sales of capital assets:

Net gain 1,866,182 484,221,334

Net loss 556,035 1,395,342

Sales of property other than capital

assets:

Net gain 115,393 2,730,681

Net loss 184,465 2,672,392

Taxable interest received 2,720,335 66,334,632

Tax-exempt interest 974,230 35,319,766

Dividends 2,483,223 67,293,025

Pensions and annuities in adjusted

gross income 589,228 23,319,222

Rent:

Net income 414,006 17,159,080

Net loss, total (deductible and

nondeductible) 325,014 3,828,604

Nondeductible rental loss 204,051 2,042,938

Royalty:

Net income 132,948 4,308,339

Net loss 5,451 34,352

Estate or trust:

Net income 98,098 8,086,257

Net loss 9,698 587,107

State income tax refunds 1,273,632 5,904,767

Alimony received 6,499 802,793

Social Security benefits in adjusted

gross income 508,202 8,272,371

Social Security benefits (nontaxable) 508,204 1,460,029

Unemployment compensation 33,420 138,343

Other income 442,742 13,646,079

Other loss 46,634 1,977,059

Foreign-earned income exclusion 46,008 3,315,562

Total income 2,807,804 1,715,535,333

Statutory adjustments, total 1,131,726 13,936,776

Payments to Individual Retirement

Arrangements 122,107 400,120

Payments to self-employed retirement

(Keogh) plans 308,596 5,878,534

Moving expenses adjustment 34,098 192,608

Adjusted gross income 2,807,804 1,701,598,557

Investment interest expense deduction 649,037 16,166,255

Total tax preferences excluded from

adjusted gross income 984,524 35,804,402

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 21,799 492,853

Passive activity loss (alternative minimum

tax adjustment) 345,893 1,245,437

Expanded income 2,807,804 1,720,109,643

Exemption amount 1,450,038 6,852,942

Itemized deductions:

Total per adjusted gross income concept 2,589,606 189,779,665

Total per expanded income concept 2,589,182 204,289,806

Charitable contributions deduction 2,487,261 55,896,330

Interest paid deduction:

Total per adjusted gross income concept 2,143,734 54,838,059

Total per expanded income concept 1,994,605 38,671,804

Total home mortgage interest 1,992,371 38,501,279

Medical and dental expense deduction 40,774 1,368,768

Net casualty or theft loss deduction 2,380 206,998

Taxes paid deduction 2,577,451 102,953,208

Net limited miscellaneous deductions per

adjusted gross income concept 407,543 7,514,115

Non-limited miscellaneous deductions 65,166 2,131,005

Excess of exemptions and deductions

over adjusted gross income 5,435 1,143,296

Taxable income 2,802,362 1,504,555,785

Tax at regular rates 2,802,463 448,841,562

Alternative minimum tax (Form 6251) 522,939 7,548,418

Income tax before credits 2,805,840 456,315,006

Tax credits:

Total 1,075,264 6,948,732

Child care credit 152,893 75,422

Minimum tax credit 83,997 1,170,621

Foreign tax credit 863,277 5,163,452

General business credit 68,939 423,115

U.S. total income tax 2,805,037 449,470,456

Taxable income which would yield:

Income tax before credits 2,805,840 1,325,821,662

Income tax after credits 2,804,536 1,307,333,786

U.S. total income tax 2,805,037 1,307,633,247

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,807,804 1,701,598,557

plus: Total tax preferences excluded

from adjusted gross income [2] 984,524 35,804,402

Social Security benefits

(nontaxable) 508,204 1,460,029

Foreign-earned income

exclusion 46,008 3,315,562

minus: Investment interest

expense deduction 649,037 16,166,255

Non-limited miscellaneous

deductions 65,166 2,131,005

Unreimbursed employee

business expenses 487,429 3,765,871

Equals: Expanded income 2,807,804 1,720,109,643

Returns with income of

$200,000 or more

Returns with

U.S. income tax

Number

Income concept, item of Amount

returns

(3) (4)

Adjusted Gross Income Concept

Salaries and wages 2,351,756 760,023,993

Business or profession:

Net income 562,315 61,550,443

Net loss 158,087 3,635,734

Farm:

Net income 19,254 839,297

Net loss 54,482 2,250,145

Partnership and S corporation net income

after Section 179 property deduction: (1)

Net income 927,511 218,397,747

Net loss 279,912 28,437,943

Sales of capital assets:

Net gain 1,824,302 482,433,517

Net loss 553,540 1,383,171

Sales of property other than capital

assets:

Net gain 114,852 2,738,624

Net loss 182,526 2,613,644

Taxable interest received 2,678,875 65,019,987

Tax-exempt interest 905,733 29,873,122

Dividends 2,433,191 65,376,129

Pensions and annuities in adjusted

gross income 559,465 21,992,613

Rent:

Net income 401,272 16,919,854

Net loss, total (deductible and

nondeductible) 317,819 3,766,053

Nondeductible rental loss 201,711 2,000,850

Royalty:

Net income 128,785 4,226,332

Net loss 5,744 34,192

Estate or trust:

Net income 93,299 8,082,847

Net loss 9,628 571,833

State income tax refunds 1,268,475 5,853,529

Alimony received ** **

Social Security benefits in adjusted

gross income 457,427 7,395,779

Social Security benefits (nontaxable) 457,427 1,305,241

Unemployment compensation 33,426 138,487

Other income 435,465 13,710,018

Other loss 33,407 1,670,403

Foreign-earned income exclusion 26,687 1,893,828

Total income 2,769,249 1,712,317,461

Statutory adjustments, total 1,125,288 13,880,014

Payments to Individual Retirement

Arrangements 119,870 395,187

Payments to self-employed retirement

(Keogh) plans 306,615 5,859,090

Moving expenses adjustment 34,578 196,101

Adjusted gross income 2,769,249 1,698,437,447

Investment interest expense deduction 656,887 16,586,015

Total tax preferences excluded from

adjusted gross income 915,257 30,276,077

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 20,203 410,274

Passive activity loss (alternative

minimum tax adjustment) 337,242 1,241,337

Expanded income 2,769,249 1,707,066,060

Exemption amount 1,408,445 6,667,169

Itemized deductions:

Total per adjusted gross income concept 2,572,649 191,210,948

Charitable contributions deduction 2,471,727 55,224,674

Interest paid deduction:

Total per adjusted gross income concept 2,157,902 55,709,624

Total home mortgage interest 2,010,275 38,953,448

Medical and dental expense deduction 33,126 1,122,022

Net casualty or theft loss deduction 2,268 116,870

Taxes paid deduction 2,563,107 102,542,431

Net limited miscellaneous deductions per

adjusted gross income concept 418,065 7,676,696

Non-limited miscellaneous deductions 74,254 3,995,157

Excess of exemptions and deductions

over adjusted gross income 2,513 806,148

Taxable income 2,766,735 1,499,969,294

Tax at regular rates 2,766,821 447,828,477

Alternative minimum tax (Form 6251) ** **

Income tax before credits 2,769,241 455,254,431

Tax credits:

Total 1,037,597 6,560,989

Child care credit 157,316 76,149

Minimum tax credit 81,127 1,134,045

Foreign tax credit 823,131 4,812,404

General business credit 70,191 424,152

U.S. total income tax 2,769,249 448,796,311

Taxable income which would yield:

Income tax before credits 2,769,241 1,321,624,761

Income tax after credits 2,769,085 1,304,467,665

U.S. total income tax 2,769,249 1,304,756,792

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,769,249 1,698,437,447

plus: Total tax preferences

excluded from adjusted

gross income [2] 915,257 30,276,077

Social Security benefits

(nontaxable) 457,427 1,305,241

Foreign-earned income exclusion 26,687 1,893,828

minus: Investment interest

expense deduction 656,887 16,586,015

Non-limited miscellaneous

deductions 74,254 3,995,157

Unreimbursed employee

business expenses 516,640 4,265,360

Equals: Expanded income 2,769,249 1,707,066,060

Expanded Income Concept

Salaries and wages 2,347,487 758,158,702

Business or profession:

Net income 568,095 61,914,956

Net loss 155,176 3,633,071

Farm:

Net income 19,503 884,288

Net loss 54,587 2,243,398

Partnership and S corporation net income

after Section 179 property deduction: (1)

Net income 934,503 218,322,989

Net loss 285,475 28,333,330

Sales of capital assets:

Net gain 1,864,791 483,585,287

Net loss 554,975 1,392,366

Sales of property other than capital

assets:

Net gain 115,267 2,726,262

Net loss 184,234 2,640,157

Taxable interest received 2,717,692 65,894,060

Tax-exempt interest 972,248 34,717,916

Dividends 2,480,764 67,072,388

Pensions and annuities in adjusted

gross income 588,637 23,301,684

Rent:

Net income 413,700 17,146,765

Net loss, total (deductible and

nondeductible) 324,702 3,819,748

Nondeductible rental loss 203,910 2,039,355

Royalty:

Net income 132,728 4,303,919

Net loss 5,443 34,051

Estate or trust:

Net income 97,913 8,077,567

Net loss 9,660 576,869

State income tax refunds 1,272,732 5,886,726

Alimony received ** **

Social Security benefits in adjusted

gross income 506,947 8,254,228

Social Security benefits (nontaxable) 506,947 1,458,745

Unemployment compensation 33,407 138,289

Other income 442,373 13,633,968

Other loss 46,543 1,974,464

Foreign-earned income exclusion 45,713 3,288,797

Total income 2,805,037 1,714,418,943

Statutory adjustments, total 1,131,099 13,929,166

Payments to Individual Retirement

Arrangements 122,053 399,965

Payments to self-employed retirement

(Keogh) plans 308,553 5,877,403

Moving expenses adjustment 34,086 192,504

Adjusted gross income 2,805,037 1,700,489,776

Investment interest expense deduction 648,164 15,622,212

Total tax preferences excluded from

adjusted gross income 982,482 35,178,196

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 21,696 468,217

Passive activity loss (alternative minimum

tax adjustment) 345,525 1,248,274

Expanded income 2,805,037 1,718,900,715

Exemption amount 1,447,897 6,841,766

Itemized deductions:

Total per adjusted gross income concept 2,587,270 188,635,529

Total per expanded income concept 2,586,851 203,672,604

Charitable contributions deduction 2,485,249 55,729,310

Interest paid deduction:

Total per adjusted gross income concept 2,142,312 54,249,455

Total per expanded income concept 1,993,493 38,627,243

Total home mortgage interest 1,991,264 38,456,904

Medical and dental expense deduction 39,649 1,249,572

Net casualty or theft loss deduction 2,268 116,870

Taxes paid deduction 2,575,220 102,818,794

Net limited miscellaneous deductions per

adjusted gross income concept 406,194 7,451,715

Non-limited miscellaneous deductions 65,097 2,124,275

Excess of exemptions and deductions

over adjusted gross income 3,464 844,759

Taxable income 2,801,572 1,504,306,683

Tax at regular rates 2,801,660 448,775,516

Alternative minimum tax (Form 6251) 522,930 7,548,411

Income tax before credits 2,805,030 456,248,953

Tax credits:

Total 1,074,455 6,882,679

Child care credit 152,875 75,415

Minimum tax credit 83,598 1,138,296

Foreign tax credit 862,832 5,131,481

General business credit 68,884 422,748

U.S. total income tax 2,805,037 449,470,456

Taxable income which would yield:

Income tax before credits 2,805,030 1,325,618,603

Income tax after credits 2,804,536 1,307,333,786

U.S. total income tax 2,805,037 1,307,633,247

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,805,037 1,700,489,776

plus: Total tax preferences excluded

from adjusted gross income [2] 982,482 35,178,196

Social Security benefits

(nontaxable) 506,947 1,456,745

Foreign-earned income

exclusion 45,713 3,288,797

minus: Investment interest

expense deduction 648,164 15,622,212

Non-limited miscellaneous

deductions 65,097 2,124,275

Unreimbursed employee

business expenses 487,293 3,765,192

Equals: Expanded income 2,805,037 1,718,900,715

Returns with income of

$200,000 or more

Returns without

U.S. income tax

Number

Income concept, item of Amount

returns

(5) (6)

Adjusted Gross Income Concept

Salaries and wages 1,223 282,717

Business or profession:

Net income 366 25,368

Net loss 279 122,178

Farm:

Net income 14 59

Net loss 88 15,024

Partnership and S corporation net income

after Section 179 property deduction: (1)

Net income 456 59,208

Net loss 815 560,724

Sales of capital assets:

Net gain 1,332 865,502

Net loss 661 1,876

Sales of property other than capital

assets:

Net gain 147 5,625

Net loss 283 40,176

Taxable interest received 2,095 685,373

Tax-exempt interest 825 84,149

Dividends 1,929 349,838

Pensions and annuities in adjusted

gross income 438 16,424

Rent:

Net income 334 17,182

Net loss, total (deductible and

nondeductible) 343 18,643

Nondeductible rental loss 221 5,981

Royalty:

Net income 200 6,868

Net loss 7 737

Estate or trust:

Net income 110 10,804

Net loss 36 3,470

State income tax refunds 798 19,009

Alimony received ** **

Social Security benefits in adjusted

gross income 633 9,307

Social Security benefits (nontaxable) 633 1,643

Unemployment compensation 22 90

Other income 429 15,450

Other loss 63 5,641

Foreign-earned income exclusion 142 11,325

Total income 2,328 1,761,192

Statutory adjustments, total 726 8,066

Payments to Individual Retirement

Arrangements 57 156

Payments to self-employed retirement

(Keogh) plans 53 1,140

Moving expenses adjustment 12 84

Adjusted gross income 2,328 1,753,126

Investment interest expense deduction 1,434 1,086,406

Total tax preferences excluded from

adjusted gross income 843 91,158

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 49 7,185

Passive activity loss (alternative

minimum tax adjustment) 380 -1,462

Expanded income 2,248 438,554

Exemption amount 1,004 3,950

Itemized deductions:

Total per adjusted gross income concept 2,202 1,996,190

Charitable contributions deduction 1,813 196,713

Interest paid deduction:

Total per adjusted gross income concept 1,824 1,147,580

Total home mortgage interest 1,400 60,926

Medical and dental expense deduction 286 57,952

Net casualty or theft loss deduction 102 88,258

Taxes paid deduction 2,049 148,046

Net limited miscellaneous deductions per

adjusted gross income concept 792 65,116

Non-limited miscellaneous deductions 504 330,631

Excess of exemptions and deductions

over adjusted gross income 1,660 477,814

Taxable income 597 230,020

Tax at regular rates 601 61,399

Alternative minimum tax (Form 6251) ** **

Income tax before credits 602 61,400

Tax credits:

Total 602 61,400

Child care credit 21 6

Minimum tax credit 362 31,539

Foreign tax credit 305 28,156

General business credit 50 346

U.S. total income tax — —

Taxable income which would yield:

Income tax before credits 602 183,949

Income tax after credits — —

U.S. total income tax — —

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,328 1,753,126

plus: Total tax preferences

excluded from adjusted

gross income [2] 843 91,158

Social Security benefits

(nontaxable) 633 2

Foreign-earned income exclusion 142 11,325

minus: Investment interest

expense deduction 1,434 1,086,406

Non-limited miscellaneous

deductions 504 330,631

Unreimbursed employee

business expenses 179 1,660

Equals: Expanded income 2,248 438,554

Expanded Income Concept

Salaries and wages 1,150 288,865

Business or profession:

Net income 271 18,272

Net loss 221 97,246

Farm:

Net income 13 46

Net loss 78 13,034

Partnership and S corporation net income

after Section 179 property deduction: (1)

Net income 457 41,966

Net loss 749 425,044

Sales of capital assets:

Net gain 1,391 636,047

Net loss 1,060 2,976

Sales of property other than capital

assets:

Net gain 128 4,419

Net loss 231 32,235

Taxable interest received 2,643 440,571

Tax-exempt interest 1,982 601,851

Dividends 2,459 220,637

Pensions and annuities in adjusted

gross income 591 17,539

Rent:

Net income 306 12,315

Net loss, total (deductible and

nondeductible) 312 8,856

Nondeductible rental loss 141 3,583

Royalty:

Net income 220 4,420

Net loss 8 301

Estate or trust:

Net income 185 8,690

Net loss 38 10,238

State income tax refunds 900 18,041

Alimony received ** **

Social Security benefits in adjusted

gross income 1,255 18,143

Social Security benefits (nontaxable) 1,257 3,284

Unemployment compensation 13 54

Other income 369 12,111

Other loss 91 2,595

Foreign-earned income exclusion 295 26,765

Total income 2,768 1,116,391

Statutory adjustments, total 627 7,610

Payments to Individual Retirement

Arrangements 54 155

Payments to self-employed retirement

(Keogh) plans 43 1,130

Moving expenses adjustment 12 104

Adjusted gross income 2,766 1,108,780

Investment interest expense deduction 873 544,043

Total tax preferences excluded from

adjusted gross income 2,042 626,207

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 103 24,636

Passive activity loss (alternative minimum

tax adjustment) 368 -2,837

Expanded income 2,766 1,208,928

Exemption amount 2,141 11,176

Itemized deductions:

Total per adjusted gross income concept 2,335 1,144,137

Total per expanded income concept 2,330 617,202

Charitable contributions deduction 2,012 167,020

Interest paid deduction:

Total per adjusted gross income concept 1,422 588,604

Total per expanded income concept 1,112 44,561

Total home mortgage interest 1,107 44,374

Medical and dental expense deduction 1,125 119,196

Net casualty or theft loss deduction 112 90,128

Taxes paid deduction 2,230 134,414

Net limited miscellaneous deductions per

adjusted gross income concept 1,349 62,400

Non-limited miscellaneous deductions 69 6,730

Excess of exemptions and deductions

over adjusted gross income 1,971 298,537

Taxable income 789 249,101

Tax at regular rates 803 66,046

Alternative minimum tax (Form 6251) 9 7

Income tax before credits 809 66,053

Tax credits:

Total 809 66,053

Child care credit 18 7

Minimum tax credit 399 32,324

Foreign tax credit 445 31,971

General business credit 55 367

U.S. total income tax — —

Taxable income which would yield:

Income tax before credits 809 203,059

Income tax after credits — —

U.S. total income tax — —

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,766 1,108,780

plus: Total tax preferences excluded

from adjusted gross income [2] 2,042 626,207

Social Security benefits

(nontaxable) 1,257 3,284

Foreign-earned income

exclusion 295 26,765

minus: Investment interest

expense deduction 873 544,043

Non-limited miscellaneous

deductions 69 6,730

Unreimbursed employee

business expenses 136 680

Equals: Expanded income 2,766 1,208,928

** Data deleted to avoid disclosure of information for specific

taxpayers. However, deleted data are included in the appropriate

totals.

(1) Section 179 of the Internal Revenue Code permits certain taxpayers

to elect to deduct all or part of the cost of certain qualifying

property in the year they place it in service, instead of taking

depreciation deductions over a specified recovery period.

(2) Includes tax-exempt interest and tax preference items subject

to alternative minimum tax.

NOTE: Detail may not add to totals because of rounding.

Table 6.–Returns With and Without Worldwide Income Tax and With

Income of $200,000 or More Under Alternative Concepts: Income,

Deductions, Credits, and Tax, by Tax Status, Tax Year 2000

[All figures are estimates based on samples-money amounts

are in thousands of dollars]

Returns with income of

$200,000 or more

Total

Number

Income concept, item of Amount

returns

(1) (2)

Adjusted Gross Income Concept

Salaries and wages 2,352,979 760,306,710

Business or profession:

Net income 562,681 61,575,811

Net loss 158,366 3,757,912

Farm:

Net income 19,268 839,357

Net loss 54,570 2,265,169

Partnership and S corporation net income

after section 179 property deduction: (1)

Net income 927,967 218,456,954

Net loss 280,727 28,998,667

Sales of capital assets:

Net gain 1,825,634 483,299,019

Net loss 554,201 1,385,047

Sales of property other than capital

assets:

Net gain 114,999 2,744,249

Net loss 182,809 2,653,820

Taxable interest received 2,680,970 65,705,360

Tax-exempt interest 906,558 29,957,271

Dividends 2,435,120 65,725,967

Pensions and annuities in adjusted

gross income 559,903 22,009,036

Rent:

Net income 401,606 16,937,036

Net loss, total (deductible and

nondeductible) 318,162 3,784,696

Nondeductible rental loss 201,932 2,006,830

Royalty:

Net income 128,985 4,233,200

Net loss 5,751 34,929

Estate or trust:

Net income 93,409 8,093,651

Net loss 9,664 575,303

State income tax refunds 1,269,273 5,872,538

Alimony received 6,499 802,815

Social Security benefits in adjusted

gross income 458,060 7,405,086

Social Security benefits (nontaxable) 458,060 1,306,883

Unemployment compensation 33,448 138,577

Other income 435,894 13,725,468

Other loss 33,470 1,676,044

Foreign-earned income exclusion 26,829 1,905,153

Total income 2,771,577 1,714,078,654

Statutory adjustments, total 1,126,014 13,888,081

Payments to Individual Retirement

Arrangements 119,927 395,344

Payments to self-employed retirement

(Keogh) plans 306,668 5,860,230

Moving expenses adjustment 34,590 196,185

Adjusted gross income 2,771,577 1,700,190,573

Investment interest expense deduction 658,321 17,672,421

Total tax preferences excluded from

adjusted gross income 916,100 30,367,235

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 20,252 417,458

Passive activity loss (alternative

minimum tax adjustment) 337,622 1,239,876

Expanded income 2,771,497 1,707,504,614

Exemption amount 1,409,449 6,671,119

Itemized deductions:

Total per adjusted gross income concept 2,574,851 193,207,138

Charitable contributions deduction 2,473,540 55,421,387

Interest paid deduction:

Total per adjusted gross income

concept 2,159,726 56,857,204

Total home mortgage interest 2,011,675 39,014,374

Medical and dental expense deduction 33,412 1,179,974

Net casualty or theft loss deduction 2,370 205,128

Taxes paid deduction 2,565,156 102,690,477

Net limited miscellaneous deductions per

adjusted gross income concept 418,857 7,741,812

Non-limited miscellaneous deductions 74,758 4,325,788

Excess of exemptions and deductions

over adjusted gross income 4,173 1,283,962

Taxable income 2,767,332 1,500,199,314

Tax at regular rates 2,767,422 447,889,876

Alternative minimum tax (Form 6251) 519,149 7,499,588

Income tax before credits 2,769,843 455,315,830

Tax credits:

Total 312,048 1,781,830

Child care credit 157,337 76,155

Minimum tax credit 81,489 1,165,584

Foreign tax credit — —

General business credit 70,241 424,498

Worldwide total income tax 2,769,555 454,211,598

Foreign taxes paid 823,439 5,415,287

Foreign taxes paid on excluded

foreign-earned income (Form 1116) 18,865 574,727

Taxable income which would yield:

Income tax before credits 2,769,843 1,321,808,711

Income tax after credits 2,769,547 1,318,683,135

Worldwide total income tax 2,769,555 1,318,955,438

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,771,577 1,700,190,573

plus: Total tax preferences

excluded from adjusted

gross income 2 916,100 30,367,235

Social Security benefits

(nontaxable) 458,060 1,306,883

Foreign-earned income

exclusion 26,829 1,905,153

minus: Investment interest expense

deduction 658,321 17,672,421

Non-limited miscellaneous

deductions 74,758 4,325,788

Unreimbursed employee

business expenses 516,819 4,267,020

Equals: Expanded income 2,771,497 1,707,504,614

Expanded Income Concept

Salaries and wages 2,348,637 758,447,567

Business or profession:

Net income 568,366 61,933,228

Net loss 155,397 3,730,317

Farm:

Net income 19,516 884,333

Net loss 54,665 2,256,433

Partnership and S corporation net income

after section 179 property deduction: (1)

Net income 934,960 218,364,955

Net loss 286,224 28,758,374

Sales of capital assets:

Net gain 1,866,182 484,221,334

Net loss 556,035 1,395,342

Sales of property other than capital

assets:

Net gain 115,393 2,730,681

Net loss 184,465 2,672,392

Taxable interest received 2,720,335 66,334,632

Tax-exempt interest 974,230 35,319,766

Dividends 2,483,223 67,293,025

Pensions and annuities in adjusted

gross income 589,228 23,319,222

Rent:

Net income 414,006 17,159,080

Net loss, total (deductible and

nondeductible) 325,014 3,828,604

Nondeductible rental loss 204,051 2,042,938

Royalty:

Net income 132,948 4,308,339

Net loss 5,451 34,352

Estate or trust:

Net income 98,098 8,086,257

Net loss 9,698 587,107

State income tax refunds 1,273,632 5,904,767

Alimony received 6,499 802,793

Social Security benefits in adjusted

gross income 508,202 8,272,371

Social Security benefits (nontaxable) 508,204 1,460,029

Unemployment compensation 33,420 138,343

Other income 442,742 13,646,079

Other loss 46,634 1,977,059

Foreign-earned income exclusion 46,008 3,315,562

Total income 2,807,804 1,715,535,333

Statutory adjustments, total 1,131,726 13,936,776

Payments to Individual Retirement

Arrangements 122,107 400,120

Payments to self-employed retirement

(Keogh) plans 308,596 5,878,534

Moving expenses adjustment 34,098 192,608

Adjusted gross income 2,807,804 1,701,598,557

Investment interest expense deduction 649,037 16,166,255

Total tax preferences excluded from

adjusted gross income 984,524 35,804,402

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 21,799 492,853

Passive activity loss (alternative

minimum tax adjustment) 345,893 1,245,437

Expanded income 2,807,804 1,720,109,643

Exemption amount 1,450,038 6,852,942

Itemized deductions:

Total per adjusted gross income concept 2,589,606 189,779,665

Total per expanded income concept 2,589,182 204,289,806

Charitable contributions deduction 2,487,261 55,896,330

Interest paid deduction:

Total per adjusted gross income concept 2,143,734 54,838,059

Total per expanded income concept 1,994,605 38,671,804

Total home mortgage interest 1,992,371 38,501,279

Medical and dental expense deduction 40,774 1,368,768

Net casualty or theft loss deduction 2,380 206,998

Taxes paid deduction 2,577,451 102,953,208

Net limited miscellaneous deductions per

adjusted gross income concept 407,543 7,514,115

Non-limited miscellaneous deductions 65,166 2,131,005

Excess of exemptions and deductions

over adjusted gross income 5,435 1,143,296

Taxable income 2,802,362 1,504,555,785

Tax at regular rates 2,802,463 448,841,562

Alternative minimum tax (Form 6251) 522,939 7,548,418

Income tax before credits 2,805,840 456,315,006

Tax credits:

Total 310,756 1,785,280

Child care credit 152,893 75,422

Minimum tax credit 83,997 1,170,621

Foreign tax credit — —

General business credit 68,939 423,115

Worldwide total income tax 2,805,483 455,515,882

Foreign taxes paid 863,280 6,045,426

Foreign taxes paid on excluded

foreign-earned income (Form 1116) 31,585 881,974

Taxable income which would yield:

Income tax before credits 2,805,840 1,325,821,662

Income tax after credits 2,805,476 1,323,573,928

Worldwide total income tax 2,805,483 1,323,849,673

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,807,804 1,701,598,557

plus: Total tax preferences

excluded from adjusted

gross income (2) 984,524 35,804,402

Social Security benefits

(nontaxable) 508,204 1,460,029

Foreign-earned income

exclusion 46,008 3,315,562

minus: Investment interest expense

deduction 649,037 16,166,255

Non-limited miscellaneous

deductions 65,166 2,131,005

Unreimbursed employee

business expenses 487,429 3,765,871

Equals: Expanded income 2,807,804 1,720,109,643

Returns with income of

$200,000 or more

Total

Returns with

worldwide income tax

Number

Income concept, item of Amount

returns

(3) (4)

Adjusted Gross Income Concept

Salaries and wages 2,351,986 760,108,158

Business or profession:

Net income 562,358 61,553,673

Net loss 158,106 3,639,131

Farm:

Net income 19,254 839,297

Net loss 54,485 2,250,181

Partnership and S corporation net income

after section 179 property deduction: (1)

Net income 927,564 218,404,005

Net loss 279,966 28,459,838

Sales of capital assets:

Net gain 1,824,489 482,529,436

Net loss 553,595 1,383,329

Sales of property other than capital

assets:

Net gain 114,869 2,740,052

Net loss 182,542 2,614,174

Taxable interest received 2,679,146 65,034,341

Tax-exempt interest 905,814 29,876,151

Dividends 2,433,428 65,391,589

Pensions and annuities in adjusted

gross income 559,506 21,995,545

Rent:

Net income 401,308 16,921,038

Net loss, total (deductible and

nondeductible) 317,847 3,766,438

Nondeductible rental loss 201,727 2,001,090

Royalty:

Net income 128,798 4,226,521

Net loss 5,745 34,460

Estate or trust:

Net income 93,305 8,085,696

Net loss 9,630 571,838

State income tax refunds 1,268,529 5,854,621

Alimony received ** **

Social Security benefits in adjusted

gross income 457,474 7,396,392

Social Security benefits (nontaxable) 457,474 1,305,349

Unemployment compensation 33,428 138,499

Other income 435,503 13,710,987

Other loss 33,434 1,671,267

Foreign-earned income exclusion 26,826 1,905,052

Total income 2,769,555 1,712,509,740

Statutory adjustments, total 1,125,358 13,880,747

Payments to Individual Retirement

Arrangements 119,879 395,208

Payments to self-employed retirement

(Keogh) plans 306,622 5,859,128

Moving expenses adjustment 34,580 196,115

Adjusted gross income 2,769,555 1,698,628,993

Investment interest expense deduction 657,017 16,610,893

Total tax preferences excluded from

adjusted gross income 915,341 30,282,922

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 20,214 414,089

Passive activity loss (alternative

minimum tax adjustment) 337,285 1,240,547

Expanded income 2,769,555 1,707,249,724

Exemption amount 1,408,559 6,667,632

Itemized deductions:

Total per adjusted gross income concept 2,572,844 191,258,008

Charitable contributions deduction 2,471,892 55,231,963

Interest paid deduction:

Total per adjusted gross income

concept 2,158,077 55,738,903

Total home mortgage interest 2,010,407 38,957,830

Medical and dental expense deduction 33,137 1,123,392

Net casualty or theft loss deduction 2,269 117,328

Taxes paid deduction 2,563,283 102,550,518

Net limited miscellaneous deductions per

adjusted gross income concept 418,112 7,678,587

Non-limited miscellaneous deductions 74,261 3,996,132

Excess of exemptions and deductions

over adjusted gross income 2,514 806,164

Taxable income 2,767,040 1,500,112,647

Tax at regular rates 2,767,127 447,868,826

Alternative minimum tax (Form 6251) ** **

Income tax before credits 2,769,547 455,294,780

Tax credits:

Total 311,752 1,760,779

Child care credit 157,322 76,150

Minimum tax credit 81,221 1,144,975

Foreign tax credit — —

General business credit 70,211 424,289

Worldwide total income tax 2,769,555 454,211,598

Foreign taxes paid 823,439 5,415,287

Foreign taxes paid on excluded

foreign-earned income (Form 1116) 18,865 574,727

Taxable income which would yield:

Income tax before credits 2,769,547 1,321,741,051

Income tax after credits 2,769,547 1,318,683,135

Worldwide total income tax 2,769,555 1,318,955,438

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,769,555 1,698,628,993

plus: Total tax preferences

excluded from adjusted

gross income 2 915,341 30,282,922

Social Security benefits

(nontaxable) 457,474 1,305,349

Foreign-earned income

exclusion 26,826 1,905,052

minus: Investment interest expense

deduction 657,017 16,610,893

Non-limited miscellaneous

deductions 74,261 3,996,132

Unreimbursed employee

business expenses 516,662 4,265,567

Equals: Expanded income 2,769,555 1,707,249,724

Expanded Income Concept

Salaries and wages 2,347,853 758,269,328

Business or profession:

Net income 568,151 61,918,514

Net loss 155,200 3,636,750

Farm:

Net income 19,504 884,288

Net loss 54,594 2,243,783

Partnership and S corporation net income

after section 179 property deduction: (1)

Net income 934,557 218,329,445

Net loss 285,531 28,353,688

Sales of capital assets:

Net gain 1,865,007 483,676,231

Net loss 555,060 1,392,606

Sales of property other than capital

assets:

Net gain 115,287 2,727,908

Net loss 184,250 2,640,634

Taxable interest received 2,718,077 65,904,167

Tax-exempt interest 972,361 34,728,870

Dividends 2,481,080 67,084,952

Pensions and annuities in adjusted

gross income 588,683 23,304,676

Rent:

Net income 413,741 17,148,521

Net loss, total (deductible and

nondeductible) 324,749 3,820,462

Nondeductible rental loss 203,932 2,039,719

Royalty:

Net income 132,743 4,304,094

Net loss 5,446 34,323

Estate or trust:

Net income 97,925 8,080,534

Net loss 9,662 576,952

State income tax refunds 1,272,796 5,887,821

Alimony received ** **

Social Security benefits in adjusted

gross income 506,998 8,254,969

Social Security benefits (nontaxable) 506,998 1,456,876

Unemployment compensation 33,411 138,310

Other income 442,425 13,635,790

Other loss 46,597 1,975,850

Foreign-earned income exclusion 45,992 3,313,940

Total income 2,805,483 1,714,614,161

Statutory adjustments, total 1,131,187 13,930,098

Payments to Individual Retirement

Arrangements 122,064 399,994

Payments to self-employed retirement

(Keogh) plans 308,563 5,877,512

Moving expenses adjustment 34,089 192,544

Adjusted gross income 2,805,483 1,700,684,063

Investment interest expense deduction 648,275 15,632,408

Total tax preferences excluded from

adjusted gross income 982,600 35,193,814

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 21,711 472,882

Passive activity loss (alternative

minimum tax adjustment) 345,564 1,247,485

Expanded income 2,805,483 1,719,125,448

Exemption amount 1,448,164 6,843,477

Itemized deductions:

Total per adjusted gross income concept 2,587,514 188,668,597

Total per expanded income concept 2,587,090 203,697,282

Charitable contributions deduction 2,485,438 55,736,613

Interest paid deduction:

Total per adjusted gross income concept 2,142,512 54,264,661

Total per expanded income concept 1,993,654 38,632,253

Total home mortgage interest 1,991,424 38,461,869

Medical and dental expense deduction 39,679 1,251,341

Net casualty or theft loss deduction 2,270 117,456

Taxes paid deduction 2,575,428 102,827,035

Net limited miscellaneous deductions per

adjusted gross income concept 406,265 7,453,612

Non-limited miscellaneous deductions 65,102 2,124,352

Excess of exemptions and deductions

over adjusted gross income 3,469 844,942

Taxable income 2,802,013 1,504,465,090

Tax at regular rates 2,802,105 448,819,553

Alternative minimum tax (Form 6251) 522,931 7,548,411

Income tax before credits 2,805,475 456,292,991

Tax credits:

Total 310,391 1,763,264

Child care credit 152,884 75,419

Minimum tax credit 83,691 1,149,074

Foreign tax credit — —

General business credit 68,905 422,904

Worldwide total income tax 2,805,483 455,515,882

Foreign taxes paid 863,280 6,045,426

Foreign taxes paid on excluded

foreign-earned income (Form 1116) 31,585 881,974

Taxable income which would yield:

Income tax before credits 2,805,475 1,325,749,823

Income tax after credits 2,805,476 1,323,573,928

Worldwide total income tax 2,805,483 1,323,849,673

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,805,483 1,700,684,063

plus: Total tax preferences

excluded from adjusted

gross income (2) 982,600 35,193,814

Social Security benefits

(nontaxable) 506,998 1,456,876

Foreign-earned income

exclusion 45,992 3,313,940

minus: Investment interest expense

deduction 648,275 15,632,408

Non-limited miscellaneous

deductions 65,102 2,124,352

Unreimbursed employee

business expenses 487,320 3,765,365

Equals: Expanded income 2,805,483 1,719,125,448

Returns with income of

$200,000 or more

Returns with

worldwide income tax

Number

Income concept, item of Amount

returns

(5) (6)

Adjusted Gross Income Concept

Salaries and wages 993 198,553

Business or profession:

Net income 323 22,138

Net loss 260 118,780

Farm:

Net income 14 59

Net loss 85 14,988

Partnership and S corporation net income

after section 179 property deduction: (1)

Net income 403 52,949

Net loss 761 538,829

Sales of capital assets:

Net gain 1,145 769,583

Net loss 606 1,717

Sales of property other than capital

assets:

Net gain 130 4,198

Net loss 267 39,646

Taxable interest received 1,824 671,018

Tax-exempt interest 744 81,120

Dividends 1,692 334,378

Pensions and annuities in adjusted

gross income 397 13,491

Rent:

Net income 298 15,998

Net loss, total (deductible and

nondeductible) 315 18,258

Nondeductible rental loss 205 5,740

Royalty:

Net income 187 6,678

Net loss 6 469

Estate or trust:

Net income 104 7,955

Net loss 34 3,465

State income tax refunds 744 17,917

Alimony received ** **

Social Security benefits in adjusted

gross income 586 8,694

Social Security benefits (nontaxable) 586 1,534

Unemployment compensation 20 78

Other income 391 14,481

Other loss 36 4,778

Foreign-earned income exclusion 3 101

Total income 2,022 1,568,914

Statutory adjustments, total 656 7,333

Payments to Individual Retirement

Arrangements 48 136

Payments to self-employed retirement

(Keogh) plans 46 1,102

Moving expenses adjustment 10 69

Adjusted gross income 2,022 1,561,580

Investment interest expense deduction 1,304 1,061,528

Total tax preferences excluded from

adjusted gross income 759 84,313

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 38 3,369

Passive activity loss (alternative

minimum tax adjustment) 337 -671

Expanded income 1,942 254,891

Exemption amount 890 3,487

Itemized deductions:

Total per adjusted gross income concept 2,007 1,949,131

Charitable contributions deduction 1,648 189,424

Interest paid deduction:

Total per adjusted gross income

concept 1,649 1,118,301

Total home mortgage interest 1,268 56,544

Medical and dental expense deduction 275 56,582

Net casualty or theft loss deduction 101 87,800

Taxes paid deduction 1,873 139,958

Net limited miscellaneous deductions per

adjusted gross income concept 745 63,226

Non-limited miscellaneous deductions 497 329,656

Excess of exemptions and deductions

over adjusted gross income 1,659 477,797

Taxable income 292 86,668

Tax at regular rates 295 21,050

Alternative minimum tax (Form 6251) ** **

Income tax before credits 296 21,050

Tax credits:

Total 296 21,050

Child care credit 15 5

Minimum tax credit 268 20,610

Foreign tax credit — —

General business credit 30 209

Worldwide total income tax — —

Foreign taxes paid — —

Foreign taxes paid on excluded

foreign-earned income (Form 1116) — —

Taxable income which would yield:

Income tax before credits 296 67,660

Income tax after credits — —

Worldwide total income tax — —

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,022 1,561,580

plus: Total tax preferences

excluded from adjusted

gross income 2 759 84,313

Social Security benefits

(nontaxable) 586 1,534

Foreign-earned income

exclusion 3 101

minus: Investment interest expense

deduction 1,304 1,061,528

Non-limited miscellaneous

deductions 497 329,656

Unreimbursed employee

business expenses 157 1,454

Equals: Expanded income 1,942 254,891

Expanded Income Concept

Salaries and wages 784 178,239

Business or profession:

Net income 215 14,715

Net loss 197 93,567

Farm:

Net income 12 45

Net loss 71 12,650

Partnership and S corporation net income

after section 179 property deduction: (1)

Net income 403 35,510

Net loss 693 404,686

Sales of capital assets:

Net gain 1,175 545,103

Net loss 975 2,736

Sales of property other than capital

assets:

Net gain 106 2,773

Net loss 215 31,758

Taxable interest received 2,258 430,465

Tax-exempt interest 1,869 590,897

Dividends 2,143 208,074

Pensions and annuities in adjusted

gross income 545 14,547

Rent:

Net income 265 10,560

Net loss, total (deductible and

nondeductible) 265 8,142

Nondeductible rental loss 119 3,220

Royalty:

Net income 205 4,245

Net loss 5 29

Estate or trust:

Net income 173 5,723

Net loss 36 10,155

State income tax refunds 836 16,947

Alimony received ** **

Social Security benefits in adjusted

gross income 1,204 17,402

Social Security benefits (nontaxable) 1,206 3,153

Unemployment compensation 9 34

Other income 317 10,289

Other loss 37 1,209

Foreign-earned income exclusion 16 1,623

Total income 2,320 921,172

Statutory adjustments, total 539 6,679

Payments to Individual Retirement

Arrangements 43 126

Payments to self-employed retirement

(Keogh) plans 33 1,021

Moving expenses adjustment 9 64

Adjusted gross income 2,320 914,494

Investment interest expense deduction 762 533,848

Total tax preferences excluded from

adjusted gross income 1,924 610,588

Total alternative minimum tax preference

items (excluding tax-exempt interest

from private activity bonds) 88 19,971

Passive activity loss (alternative

minimum tax adjustment) 329 -2,049

Expanded income 2,320 984,195

Exemption amount 1,874 9,465

Itemized deductions:

Total per adjusted gross income concept 2,091 1,111,069

Total per expanded income concept 2,091 592,524

Charitable contributions deduction 1,823 159,716

Interest paid deduction:

Total per adjusted gross income concept 1,222 573,399

Total per expanded income concept 951 39,551

Total home mortgage interest 947 39,410

Medical and dental expense deduction 1,095 117,427

Net casualty or theft loss deduction 110 89,542

Taxes paid deduction 2,022 126,173

Net limited miscellaneous deductions per

adjusted gross income concept 1,278 60,503

Non-limited miscellaneous deductions 64 6,653

Excess of exemptions and deductions

over adjusted gross income 1,966 298,354

Taxable income 348 90,695

Tax at regular rates 358 22,009

Alternative minimum tax (Form 6251) 8 7

Income tax before credits 364 22,016

Tax credits:

Total 364 22,016

Child care credit 9 3

Minimum tax credit 306 21,547

Foreign tax credit — —

General business credit 34 211

Worldwide total income tax — —

Foreign taxes paid — —

Foreign taxes paid on excluded

foreign-earned income (Form 1116) — —

Taxable income which would yield:

Income tax before credits 364 71,840

Income tax after credits — —

Worldwide total income tax — —

Reconciliation of adjusted gross income

and expanded income:

Adjusted gross income 2,320 914,494

plus: Total tax preferences

excluded from adjusted

gross income (2) 1,924 610,588

Social Security benefits

(nontaxable) 1,206 3,153

Foreign-earned income

exclusion 16 1,623

minus: Investment interest expense

deduction 762 533,848

Non-limited miscellaneous

deductions 64 6,653

Unreimbursed employee

business expenses 109 506

Equals: Expanded income 2,320 984,195

** Data deleted to avoid disclosure of information for specific

taxpayers. However, deleted data are included in the appropriate

totals.

(1) Section 179 of the Internal Revenue Code permits certain taxpayers

to elect to deduct all or part of the cost of certain qualifying

property in the year they place it in service, instead of taking

depreciation deductions over a specified recovery period.

(2) Includes tax-exempt interest and tax preference items subject to

alternative minimum tax.

NOTE: Detail may not add to totals because of rounding.

Table 7.–Returns With and Without U.S. Income Tax and With Income of

$200,000 or More Under Alternative Concepts: Number of Returns and

Percentages Classified by Item With the Largest Tax Effect and by Item

With the Second Largest Tax Effect, Tax Year 2000

[All figures are estimates based on samples]

Item with the second Total

largest tax effect

Number Percentage

of of

returns total

(1) (2)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 2,651,389 100.0

Interest paid deduction 932,740 35.2

Investment interest expense deduction (1) 76,357 2.9

Taxes paid deduction 817,604 30.8

Charitable contributions deduction 526,118 19.8

Medical and dental expense deduction 6,652 0.3

Net casualty or theft loss deduction 62 (2)

Total miscellaneous deductions 101,570 3.8

Foreign tax credit 32,123 1.2

General business credit 12,200 0.5

All other tax credits 16,654 0.6

Partnership and S corporation net losses 42,140 1.6

No second largest item 87,172 3.3

Returns with expanded income of

$200,000 or more

Total 2,704,567 100.0

Interest paid deduction 916,544 33.9

Tax-exempt interest (3) 162,242 6.0

Taxes paid deduction 859,571 31.8

Charitable contributions deduction 469,149 17.3

Medical and dental expense deduction 8,355 0.3

Net casualty or theft loss deduction 62 (2)

Total miscellaneous deductions 42,519 1.6

Foreign tax credit 62,620 2.3

General business credit 10,681 0.4

All other tax credits 17,326 0.6

Partnership and S corporation net losses 43,942 1.6

Foreign-earned income exclusion (3) 23,585 0.9

No second largest item 87,971 3.3

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 2,299 100.0

Interest paid deduction 413 18.0

Investment interest expense deduction (1) 272 11.8

Taxes paid deduction 469 20.4

Charitable contributions deduction 301 13.1

Medical and dental expense deduction 47 2.0

Net casualty or theft loss deduction 127 5.5

Total miscellaneous deductions 120 5.2

Foreign tax credit 13 0.6

All other tax credits (4) 37 1.6

Partnership and S corporation net losses 313 13.6

No second largest item 187 8.1

Returns with expanded income of

$200,000 or more

Total 2,766 100.0

Interest paid deduction 294 10.6

Tax-exempt interest (3) 204 7.4

Taxes paid deduction 499 18.0

Charitable contributions deduction 214 7.7

Medical and dental expense deduction 402 14.5

Net casualty or theft loss deduction 253 9.1

Total miscellaneous deductions 174 6.3

Foreign tax credit 68 2.5

All other tax credits (4) 83 3.0

Partnership and S corporation net losses 199 7.2

Foreign-earned income exclusion (3) 291 10.5

No second largest item 85 3.1

Item with the largest

tax effect

Interest

Item with the second paid deduction

largest tax effect

Number Percentage

of of

returns total

(3) (4)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 607,630 22.9

Interest paid deduction — —

Investment interest expense deduction (1) 10,923 1.8

Taxes paid deduction 516,419 85.0

Charitable contributions deduction 56,018 9.2

Medical and dental expense deduction 510 0.1

Net casualty or theft loss deduction 42 (2)

Total miscellaneous deductions 12,885 2.1

Foreign tax credit 1,053 0.2

General business credit 1,226 0.2

All other tax credits 829 0.1

Partnership and S corporation net losses 7,069 1.2

No second largest item 655 0.1

Returns with expanded income of

$200,000 or more

Total 599,058 22.1

Interest paid deduction — —

Tax-exempt interest (3) 5,779 1.0

Taxes paid deduction 520,669 86.9

Charitable contributions deduction 58,054 9.7

Medical and dental expense deduction 510 0.1

Net casualty or theft loss deduction 42 (2)

Total miscellaneous deductions 3,612 0.6

Foreign tax credit 603 0.1

General business credit 1,034 0.2

All other tax credits 879 0.1

Partnership and S corporation net losses 7,070 1.2

Foreign-earned income exclusion (3) 151 (2)

No second largest item 655 0.1

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 86 3.7

Interest paid deduction — —

Investment interest expense deduction (1) 16 18.6

Taxes paid deduction 22 25.6

Charitable contributions deduction 9 10.5

Medical and dental expense deduction ** **

Net casualty or theft loss deduction ** **

Total miscellaneous deductions ** **

Foreign tax credit ** **

All other tax credits (4) ** **

Partnership and S corporation net losses 28 32.6

No second largest item — —

Returns with expanded income of

$200,000 or more

Total 45 1.6

Interest paid deduction — —

Tax-exempt interest (3) 19 42.2

Taxes paid deduction 14 31.1

Charitable contributions deduction 5 11.1

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions ** **

Foreign tax credit — —

All other tax credits (4) ** **

Partnership and S corporation net losses ** **

Foreign-earned income exclusion (3) ** **

No second largest item — —

Item with the largest

tax effect

Investment interest

Item with the second expense deduction (1)

largest tax effect

Number Percentage

of of

returns total

(5) (6)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 69,492 2.6

Interest paid deduction 17,168 24.7

Investment interest expense deduction (1) — —

Taxes paid deduction 35,465 51.0

Charitable contributions deduction 8,898 12.8

Medical and dental expense deduction 19 (2)

Net casualty or theft loss deduction — —

Total miscellaneous deductions 2,375 3.4

Foreign tax credit 690 1.0

General business credit 437 0.6

All other tax credits 917 1.3

Partnership and S corporation net losses 3,323 4.8

No second largest item 198 0.3

Returns with expanded income of

$200,000 or more

Total — —

Interest paid deduction — —

Tax-exempt interest (3) — —

Taxes paid deduction — —

Charitable contributions deduction — —

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit — —

General business credit — —

All other tax credits — —

Partnership and S corporation net losses — —

Foreign-earned income exclusion (3) — —

No second largest item — —

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 721 31.4

Interest paid deduction 177 24.5

Investment interest expense deduction (1) — —

Taxes paid deduction 159 22.1

Charitable contributions deduction 178 24.7

Medical and dental expense deduction 9 1.2

Net casualty or theft loss deduction — —

Total miscellaneous deductions 39 5.4

Foreign tax credit ** **

All other tax credits (4) 5 0.7

Partnership and S corporation net losses 144 20.0

No second largest item ** **

Returns with expanded income of

$200,000 or more

Total — —

Interest paid deduction — —

Tax-exempt interest (3) — —

Taxes paid deduction — —

Charitable contributions deduction — —

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit — —

All other tax credits (4) — —

Partnership and S corporation net losses — —

Foreign-earned income exclusion (3) — —

No second largest item — —

Item with the largest

tax effect

Taxes paid

Item with the second deduction

largest tax effect

Number Percentage

of of

returns total

(7) (8)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 1,446,727 54.6

Interest paid deduction 809,845 56.0

Investment interest expense deduction (1) 46,598 3.2

Taxes paid deduction — —

Charitable contributions deduction 442,701 30.6

Medical and dental expense deduction 4,092 0.3

Net casualty or theft loss deduction — —

Total miscellaneous deductions 70,093 4.8

Foreign tax credit 20,170 1.4

General business credit 6,949 0.5

All other tax credits 9,744 0.7

Partnership and S corporation net losses 22,560 1.6

No second largest item 13,974 1.0

Returns with expanded income of

$200,000 or more

Total 1,373,171 50.8

Interest paid deduction 813,015 59.2

Tax-exempt interest (3) 109,228 8.0

Taxes paid deduction — —

Charitable contributions deduction 366,591 26.7

Medical and dental expense deduction 3,578 0.3

Net casualty or theft loss deduction 8 (2)

Total miscellaneous deductions 19,169 1.4

Foreign tax credit 12,429 0.9

General business credit 5,540 0.4

All other tax credits 9,018 0.7

Partnership and S corporation net losses 18,933 1.4

Foreign-earned income exclusion (3) 127 (2)

No second largest item 15,535 1.1

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 76 3.3

Interest paid deduction 14 18.4

Investment interest expense deduction (1) 28 36.8

Taxes paid deduction — —

Charitable contributions deduction 17 22.4

Medical and dental expense deduction ** **

Net casualty or theft loss deduction — —

Total miscellaneous deductions 10 13.2

Foreign tax credit — —

All other tax credits (4) ** **

Partnership and S corporation net losses ** **

No second largest item — —

Returns with expanded income of

$200,000 or more

Total 74 2.7

Interest paid deduction 6 8.1

Tax-exempt interest (3) 37 50.0

Taxes paid deduction — —

Charitable contributions deduction 13 17.6

Medical and dental expense deduction ** **

Net casualty or theft loss deduction — —

Total miscellaneous deductions 6 8.1

Foreign tax credit — —

All other tax credits (4) ** **

Partnership and S corporation net losses 5 6.8

Foreign-earned income exclusion (3) ** **

No second largest item — —

Item with the largest

tax effect

Charitable contributions

Item with the second deduction

largest tax effect

Number Percentage

of of

returns total

(9) (10)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 231,603 8.7

Interest paid deduction 52,264 22.6

Investment interest expense deduction (1) 7,274 3.1

Taxes paid deduction 149,546 64.6

Charitable contributions deduction — —

Medical and dental expense deduction 1,619 0.7

Net casualty or theft loss deduction 8 (2)

Total miscellaneous deductions 10,233 4.4

Foreign tax credit 1,771 0.8

General business credit 2,505 1.1

All other tax credits 955 0.4

Partnership and S corporation net losses 4,997 2.2

No second largest item 430 0.2

Returns with expanded income of

$200,000 or more

Total 219,806 8.1

Interest paid deduction 53,240 24.2

Tax-exempt interest (3) 25,403 11.6

Taxes paid deduction 126,464 57.5

Charitable contributions deduction — —

Medical and dental expense deduction 1,092 0.5

Net casualty or theft loss deduction 8 (2)

Total miscellaneous deductions 5,011 2.3

Foreign tax credit 1,286 0.6

General business credit 1,553 0.7

All other tax credits 941 0.4

Partnership and S corporation net losses 4,348 2.0

Foreign-earned income exclusion (3) 356 0.2

No second largest item 104 (2)

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 81 3.5

Interest paid deduction 14 17.3

Investment interest expense deduction (1) 20 24.7

Taxes paid deduction 9 7.4

Charitable contributions deduction — —

Medical and dental expense deduction 27 33.3

Net casualty or theft loss deduction — —

Total miscellaneous deductions ** **

Foreign tax credit ** **

All other tax credits (4) ** **

Partnership and S corporation net losses ** **

No second largest item — —

Returns with expanded income of

$200,000 or more

Total 108 3.9

Interest paid deduction 19 17.6

Tax-exempt interest (3) 6 5.6

Taxes paid deduction 11 10.2

Charitable contributions deduction — —

Medical and dental expense deduction 47 43.5

Net casualty or theft loss deduction — —

Total miscellaneous deductions 10 9.3

Foreign tax credit ** **

All other tax credits (4) 4 3.7

Partnership and S corporation net losses 6 5.6

Foreign-earned income exclusion (3) ** **

No second largest item — —

Item with the largest

tax effect

Medical and dental

Item with the second expense deduction

largest tax effect

Number Percentage

of of

returns total

(11) (12)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 13,862 0.5

Interest paid deduction 1,342 9.7

Investment interest expense deduction (1) 48 0.3

Taxes paid deduction 7,915 57.1

Charitable contributions deduction 1,034 7.5

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions 1,977 14.3

Foreign tax credit 1,017 7.3

General business credit — —

All other tax credits 189 1.4

Partnership and S corporation net losses 340 2.5

No second largest item — —

Returns with expanded income of

$200,000 or more

Total 13,165 0.5

Interest paid deduction 1,156 8.8

Tax-exempt interest (3) 3,306 25.1

Taxes paid deduction 6,026 45.8

Charitable contributions deduction 897 6.8

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions 1,100 8.4

Foreign tax credit 151 1.1

General business credit — —

All other tax credits 189 1.4

Partnership and S corporation net losses 340 2.6

Foreign-earned income exclusion (3) — —

No second largest item — —

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 182 7.9

Interest paid deduction 4 2.2

Investment interest expense deduction (1) ** **

Taxes paid deduction 10 5.5

Charitable contributions deduction 25 13.7

Medical and dental expense deduction — —

Net casualty or theft loss deduction ** **

Total miscellaneous deductions 13 7.1

Foreign tax credit — —

All other tax credits (4) — —

Partnership and S corporation net losses ** **

No second largest item ** **

Returns with expanded income of

$200,000 or more

Total 363 13.1

Interest paid deduction 4 1.1

Tax-exempt interest (3) 68 18.7

Taxes paid deduction 9 2.5

Charitable contributions deduction 18 5

Medical and dental expense deduction — —

Net casualty or theft loss deduction 248 68.3

Total miscellaneous deductions ** **

Foreign tax credit — —

All other tax credits (4) — —

Partnership and S corporation net losses ** **

Foreign-earned income exclusion (3) ** **

No second largest item ** **

Item with the largest

tax effect

Net casualty or theft

Item with the second loss deduction

largest tax effect

Number Percentage

of of

returns total

(13) (14)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 1,082 (2)

Interest paid deduction 392 36.2

Investment interest expense deduction (1) 5 0.5

Taxes paid deduction 677 62.5

Charitable contributions deduction — —

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions 8 0.7

Foreign tax credit — —

General business credit — —

All other tax credits — —

Partnership and S corporation net losses — —

No second largest item — —

Returns with expanded income of

$200,000 or more

Total 1,091 (2)

Interest paid deduction 392 36.0

Tax-exempt interest (3) — —

Taxes paid deduction 678 62.2

Charitable contributions deduction 4 0.4

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions 16 1.5

Foreign tax credit — —

General business credit — —

All other tax credits — —

Partnership and S corporation net losses — —

Foreign-earned income exclusion (3) — —

No second largest item — —

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 90 3.9

Interest paid deduction 21 23.3

Investment interest expense deduction (1) 4 4.4

Taxes paid deduction 19 21.1

Charitable contributions deduction 8 8.9

Medical and dental expense deduction ** **

Net casualty or theft loss deduction — —

Total miscellaneous deductions 33 36.7

Foreign tax credit — —

All other tax credits (4) — —

Partnership and S corporation net losses 3 3.3

No second largest item ** **

Returns with expanded income of

$200,000 or more

Total 101 3.7

Interest paid deduction 21 20.8

Tax-exempt interest (3) 8 7.9

Taxes paid deduction 15 14.9

Charitable contributions deduction 7 6.9

Medical and dental expense deduction ** **

Net casualty or theft loss deduction — —

Total miscellaneous deductions ** **

Foreign tax credit — —

All other tax credits (4) — —

Partnership and S corporation net losses ** **

Foreign-earned income exclusion (3) — —

No second largest item ** **

Item with the largest

tax effect

Total miscellaneous

Item with the second deductions

largest tax effect

Number Percentage

of of

returns total

(15) (16)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 71,517 2.7

Interest paid deduction 19,121 26.7

Investment interest expense deduction (1) 1,536 2.1

Taxes paid deduction 39,351 55.0

Charitable contributions deduction 7,942 11.1

Medical and dental expense deduction 309 0.4

Net casualty or theft loss deduction 8 (2)

Total miscellaneous deductions — —

Foreign tax credit 437 0.6

General business credit 180 0.3

All other tax credits 203 0.3

Partnership and S corporation net losses 1,457 2.0

No second largest item 973 1.4

Returns with expanded income of

$200,000 or more

Total 15,232 0.6

Interest paid deduction 1,884 12.4

Tax-exempt interest (3) 2,803 18.4

Taxes paid deduction 7,160 47.0

Charitable contributions deduction 2,393 15.7

Medical and dental expense deduction 155 1.0

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit 253 1.7

General business credit 17 0.1

All other tax credits 18 0.1

Partnership and S corporation net losses 479 3.1

Foreign-earned income exclusion (3) — —

No second largest item 70 0.5

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 423 18.4

Interest paid deduction 79 18.7

Investment interest expense deduction (1) 14 3.3

Taxes paid deduction 117 27.7

Charitable contributions deduction 21 5.0

Medical and dental expense deduction 5 1.2

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit — —

All other tax credits (4) 4 0.9

Partnership and S corporation net losses 109 25.8

No second largest item 74 17.5

Returns with expanded income of

$200,000 or more

Total 28 1.0

Interest paid deduction ** **

Tax-exempt interest (3) 6 21.4

Taxes paid deduction ** **

Charitable contributions deduction 6 21.4

Medical and dental expense deduction ** **

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit — —

All other tax credits (4) — —

Partnership and S corporation net losses 5 17.9

Foreign-earned income exclusion (3) — —

No second largest item — —

Item with the largest

tax effect

Foreign tax

Item with the second credit

largest tax effect

Number Percentage

of of

returns total

(17) (18)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 88,160 3.3

Interest paid deduction 8,933 10.1

Investment interest expense deduction (1) 1,542 1.7

Taxes paid deduction 17,989 20.4

Charitable contributions deduction 1,562 1.8

Medical and dental expense deduction 16 (2)

Net casualty or theft loss deduction — —

Total miscellaneous deductions 820 0.9

Foreign tax credit — —

General business credit 156 0.2

All other tax credits 1,657 1.9

Partnership and S corporation net losses 1,664 1.9

No second largest item 53,821 61.0

Returns with expanded income of

$200,000 or more

Total 68,544 2.5

Interest paid deduction 3,742 5.5

Tax-exempt interest (3) 2,648 3.9

Taxes paid deduction 13,551 19.8

Charitable contributions deduction 675 1.0

Medical and dental expense deduction 16 (2)

Net casualty or theft loss deduction — —

Total miscellaneous deductions 382 0.6

Foreign tax credit — —

General business credit 77 0.1

All other tax credits 442 0.6

Partnership and S corporation net losses 839 1.2

Foreign-earned income exclusion (3) 22,721 33.1

No second largest item 23,451 34.2

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 157 6.8

Interest paid deduction 28 17.8

Investment interest expense deduction (1) 14 8.9

Taxes paid deduction ** **

Charitable contributions deduction ** **

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions 3 1.9

Foreign tax credit — —

All other tax credits (4) ** **

Partnership and S corporation net losses 7 4.5

No second largest item 91.0 58.0

Returns with expanded income of

$200,000 or more

Total 229 8.3

Interest paid deduction 6 2.6

Tax-exempt interest (3) ** **

Taxes paid deduction ** **

Charitable contributions deduction ** **

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit — —

All other tax credits (4) ** **

Partnership and S corporation net losses ** **

Foreign-earned income exclusion (3) 200 87.3

No second largest item 14 6.1

Item with the largest

tax effect

General

Item with the second business credit

largest tax effect

Number Percentage

of of

returns total

(19) (20)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 8,615 0.3

Interest paid deduction 1,611 18.7

Investment interest expense deduction (1) 362 4.2

Taxes paid deduction 3,659 42.5

Charitable contributions deduction 295 3.4

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions 177 2.1

Foreign tax credit 597 6.9

General business credit — —

All other tax credits 231 2.7

Partnership and S corporation net losses 441 5.1

No second largest item 1,243 14.4

Returns with expanded income of

$200,000 or more

Total 7,866 0.3

Interest paid deduction 1,546 19.7

Tax-exempt interest (3) 888 11.3

Taxes paid deduction 3,308 42.1

Charitable contributions deduction 249 3.2

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions 5 0.1

Foreign tax credit 378 4.8

General business credit — —

All other tax credits 198 2.5

Partnership and S corporation net losses 320 4.1

Foreign-earned income exclusion (3) — —

No second largest item 972 12.4

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 276 12.0

Interest paid deduction 63 23.0

Investment interest expense deduction (1) 43 15.7

Taxes paid deduction 107 39.1

Charitable contributions deduction 20 7.2

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions 3 1.1

Foreign tax credit ** **

All other tax credits (4) ** **

Partnership and S corporation net losses 15 5.5

No second largest item 15 5.5

Returns with expanded income of

$200,000 or more

Total 274 9.9

Interest paid deduction 81 29.7

Tax-exempt interest (3) 16 5.9

Taxes paid deduction 119 43.6

Charitable contributions deduction 21 7.7

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions ** **

Foreign tax credit 5 1.8

All other tax credits (4) ** **

Partnership and S corporation net losses 13 4.8

Foreign-earned income exclusion (3) — —

No second largest item 15 5.5

Item with the largest

tax effect

All other

Item with the second tax credits

largest tax effect

Number Percentage

of of

returns total

(21) (22)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 23,796 0.9

Interest paid deduction 3,273 13.8

Investment interest expense deduction (1) 2,142 9.0

Taxes paid deduction 10,589 44.5

Charitable contributions deduction 946 4.0

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions 131 0.5

Foreign tax credit 1,324 5.6

General business credit 125 0.5

All other tax credits — —

Partnership and S corporation net losses 289 1.2

No second largest item 4,976 20.9

Returns with expanded income of

$200,000 or more

Total 22,483 0.8

Interest paid deduction 4,141 18.4

Tax-exempt interest (3) 2,064 9.2

Taxes paid deduction 10,903 48.5

Charitable contributions deduction 887 3.9

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions 65 0.3

Foreign tax credit 559 2.5

General business credit 138 0.6

All other tax credits — —

Partnership and S corporation net losses 286 1.3

Foreign-earned income exclusion (3) 10 (2)

No second largest item 3,431 15.3

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 207 9.0

Interest paid deduction 13 6.3

Investment interest expense deduction (1) 131 63.3

Taxes paid deduction ** **

Charitable contributions deduction 15 7.2

Medical and dental expense deduction — —

Net casualty or theft loss deduction ** **

Total miscellaneous deductions ** **

Foreign tax credit — —

All other tax credits (4) 12 5.8

Partnership and S corporation net losses — —

No second largest item — —

Returns with expanded income of

$200,000 or more

Total 209 7.6

Interest paid deduction ** **

Tax-exempt interest (3) 41 19.6

Taxes paid deduction 9 4.3

Charitable contributions deduction 12 5.7

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions ** **

Foreign tax credit ** **

All other tax credits (4) 53 25.4

Partnership and S corporation net losses — —

Foreign-earned income exclusion (3) ** **

No second largest item — —

Item with the largest

tax effect

Partnership and S

Item with the second corporation net losses

largest tax effect

Number Percentage

of of

returns total

(23) (24)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total 88,906 3.4

Interest paid deduction 18,790 21.1

Investment interest expense deduction (1) 5,926 6.7

Taxes paid deduction 35,994 40.5

Charitable contributions deduction 6,721 7.6

Medical and dental expense deduction 86 0.1

Net casualty or theft loss deduction 3 (2)

Total miscellaneous deductions 2,873 3.2

Foreign tax credit 5,062 5.7

General business credit 622 0.7

All other tax credits 1,927 2.2

Partnership and S corporation net losses — —

No second largest item 10,901 12.3

Returns with expanded income of

$200,000 or more

Total 85,252 3.2

Interest paid deduction 19,439 22.8

Tax-exempt interest (3) 8,884 10.4

Taxes paid deduction 34,307 40.2

Charitable contributions deduction 6,872 8.1

Medical and dental expense deduction 86 0.1

Net casualty or theft loss deduction 3 (2)

Total miscellaneous deductions 953 1.1

Foreign tax credit 2,693 3.2

General business credit 663 0.8

All other tax credits 2,120 2.5

Partnership and S corporation net losses — —

Foreign-earned income exclusion (3) 167 0.2

No second largest item 9.067 10.6

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total — —

Interest paid deduction — —

Investment interest expense deduction (1) — —

Taxes paid deduction — —

Charitable contributions deduction — —

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit — —

All other tax credits (4) — —

Partnership and S corporation net losses — —

No second largest item — —

Returns with expanded income of

$200,000 or more

Total 80 2.9

Interest paid deduction 12 15.0

Tax-exempt interest (3) ** **

Taxes paid deduction 6 7.5

Charitable contributions deduction ** **

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit 59 73.8

All other tax credits (4) — —

Partnership and S corporation net losses ** **

Foreign-earned income exclusion (3) — —

No second largest item — —

Item with the largest

tax effect

Foreign-earned

Item with the second income exclusion (3)

largest tax effect

Number Percentage

of of

returns total

(25) (26)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total — —

Interest paid deduction — —

Investment interest expense deduction (1) — —

Taxes paid deduction — —

Charitable contributions deduction — —

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit — —

General business credit — —

All other tax credits — —

Partnership and S corporation net losses — —

No second largest item — —

Returns with expanded income of

$200,000 or more

Total 20,399 0.8

Interest paid deduction 772 3.8

Tax-exempt interest (3) 1,240 6.1

Taxes paid deduction 1,806 8.9

Charitable contributions deduction 536 2.6

Medical and dental expense deduction 151 0.7

Net casualty or theft loss deduction — —

Total miscellaneous deductions 159 0.8

Foreign tax credit 14,088 69.1

General business credit — —

All other tax credits 49 0.2

Partnership and S corporation net losses 346 1.7

Foreign-earned income exclusion (3) — —

No second largest item 1,252 6.1

Returns without U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total — —

Interest paid deduction — —

Investment interest expense deduction (1) — —

Taxes paid deduction — —

Charitable contributions deduction — —

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit — —

All other tax credits (4) — —

Partnership and S corporation net losses — —

No second largest item — —

Returns with expanded income of

$200,000 or more

Total 1,255 45.4

Interest paid deduction 134 10.7

Tax-exempt interest (3) — —

Taxes paid deduction 310 24.7

Charitable contributions deduction 130 10.4

Medical and dental expense deduction 350 27.9

Net casualty or theft loss deduction 5 0.4

Total miscellaneous deductions 97 7.7

Foreign tax credit ** **

All other tax credits (4) 8 0.6

Partnership and S corporation net losses 160 12.7

Foreign-earned income exclusion (3) ** **

No second largest item 53 4.2

Item with the largest

tax effect

Tax-exempt

Item with the second interest (3)

largest tax effect

Number Percentage

of of

returns total

(27) (28)

Returns with U.S. income tax

Returns with adjusted gross income

of $200,000 or more

Total — —

Interest paid deduction — —

Investment interest expense deduction (1) — —

Taxes paid deduction — —

Charitable contributions deduction — —

Medical and dental expense deduction — —

Net casualty or theft loss deduction — —

Total miscellaneous deductions — —

Foreign tax credit — —

General business credit — —

All other tax credits — —

Partnership and S corporation net losses — —

No second largest item — —

Returns with expanded income of

$200,000 or more

Total 278,502 10.3

Interest paid deduction 17,216 6.2

Tax-exempt interest (3) — —

Taxes paid deduction 134,700 48.4

Charitable contributions deduction 31,993 11.5

Medical and dental expense deduction 2,768 1.0

Net casualty or theft loss deduction — —

Total miscellaneous deductions 12,046 4.3

Foreign tax credit 30,180 10.8

General business credit 1,658 0.6

All other tax credits 3,474 1.2

Partnership and S corporation net losses 10,980 3.9

Foreign-earned income exclusion (3) 53 (2)

No second largest item 33,435 12.0

** Data deleted to avoid disclosure of information for specific

taxpayers. However, deleted data are included in the appropriate

totals.

(1) Investment interest expense deduction only has an effect when

using the adjusted gross income concept.

(2) Less than 0.05 percent.

(3) Tax-exempt interest and foreign-earned income exclusion only have

an effect when using the expanded income concept.

(4) General business credit has been combined with all other tax

credits.

NOTES: Detail may not add to totals because of rounding. Total columns

do not include returns with no tax effect.

Table 8.–Returns With and Without Worldwide Income Tax and With Income

of $200,000 or More Under Alternative Concepts: Number of Returns and

Percentages Classified by Item With the Largest Tax Effect and by Item

With the Second Largest Tax Effect, Tax Year 2000

[All figures are estimates based on samples]

Total

Number Percentage

Item with the second of of

largest tax effect returns total

(1) (2)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 2,596,672 100.0

Interest paid deduction 934,101 36.0

Investment interest expense

deduction (1) 77,494 3.0

Taxes paid deduction 812,708 31.3

Charitable contributions

deduction 543,493 20.9

Medical and dental expense

deduction 6,831 0.3

Net casualty or theft loss

deduction 62 (2)

Total miscellaneous

deductions 101,593 3.9

General business credit 12,301 0.5

All other tax credits 15,486 0.6

Partnership and S corporation

net losses 41,286 1.6

No second largest item 51,319 2.0

Returns with expanded

income of

$200,000 or more

Total 2,681,527 100.0

Interest paid deduction 930,676 34.7

Tax-exempt interest (3) 167,220 6.2

Taxes paid deduction 859,910 32.1

Charitable contributions

deduction 478,659 17.9

Medical and dental expense

deduction 8,345 0.3

Net casualty or theft loss

deduction 62 (2)

Total miscellaneous

deductions 42,673 1.6

General business credit 10,993 0.4

All other tax credits 20,080 0.7

Partnership and S corporation

net losses 45,312 1.7

Foreign-earned income

exclusion (3) 2,047 0.1

No second largest item 115,552 4.3

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 1,993 100.0

Interest paid deduction 363 18.2

Investment interest expense

deduction (1) 235 11.8

Taxes paid deduction 431 21.6

Charitable contributions

deduction 270 13.5

Medical and dental expense

deduction 44 2.2

Net casualty or theft loss

deduction 127 6.4

Total miscellaneous

deductions 111 5.6

All other tax credits (4) 21 1.1

Partnership and S corporation

net losses 297 14.9

No second largest item 94 4.7

Returns with expanded

income of

$200,000 or more

Total 2,320 100.0

Interest paid deduction 254 10.9

Tax-exempt interest (3) 191 8.2

Taxes paid deduction 458 19.7

Charitable contributions

deduction 189 8.1

Medical and dental expense

deduction 397 17.1

Net casualty or theft loss

deduction 253 10.9

Total miscellaneous deductions 167 7.2

All other tax credits (4) 67 2.9

Partnership and S corporation

net losses 188 8.1

Foreign-earned income

exclusion (3) 86 3.7

No second largest item

net losses 70 3.0

Item with the largest tax effect

Interest

paid deduction

Number Percentage

Item with the second of of

largest tax effect returns total

(3) (4)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 615,485 23.7

Interest paid deduction — —

Investment interest expense

deduction (1) 11,469 1.9

Taxes paid deduction 523,386 85.0

Charitable contributions

deduction 57,032 9.3

Medical and dental expense

deduction 510 0.1

Net casualty or theft loss

deduction 42 (2)

Total miscellaneous

deductions 12,938 2.1

General business credit 1,227 0.2

All other tax credits 980 0.2

Partnership and S corporation

net losses 7,070 1.1

No second largest item 831 0.1

Returns with expanded

income of

$200,000 or more

Total 602,790 22.5

Interest paid deduction — —

Tax-exempt interest (3) 5,874 1.0

Taxes paid deduction 524,514 87.0

Charitable contributions

deduction 58,283 9.7

Medical and dental expense

deduction 510 0.1

Net casualty or theft loss

deduction 42 (2)

Total miscellaneous

deductions 3,616 0.6

General business credit 1,035 0.2

All other tax credits 879 0.1

Partnership and S corporation

net losses 7,070 1.2

Foreign-earned income

exclusion (3) 311 0.1

No second largest item 656 0.1

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 80 4.0

Interest paid deduction — —

Investment interest expense

deduction (1) 16 20.0

Taxes paid deduction 21 26.3

Charitable contributions

deduction 7 8.8

Medical and dental expense

deduction 4 5.0

Net casualty or theft loss

deduction ** **

Total miscellaneous

deductions ** **

All other tax credits (4) ** **

Partnership and S corporation

net losses 28 35.0

No second largest item — —

Returns with expanded

income of

$200,000 or more

Total 40 1.7

Interest paid deduction — —

Tax-exempt interest (3) 19 47.5

Taxes paid deduction 13 32.5

Charitable contributions

deduction 4 10.0

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous deductions — —

All other tax credits (4) ** **

Partnership and S corporation

net losses ** **

Foreign-earned income

exclusion (3) — —

No second largest item

net losses — —

Item with the largest tax effect

Investment interest

expense deduction (1)

Number Percentage

Item with the second of of

largest tax effect returns total

(5) (6)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 71,087 2.7

Interest paid deduction 17,372 24.4

Investment interest expense

deduction (1) — —

Taxes paid deduction 36,664 51.6

Charitable contributions

deduction 9,363 13.2

Medical and dental expense

deduction 21 (2)

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 2,432 3.4

General business credit 448 0.6

All other tax credits 942 1.3

Partnership and S corporation

net losses 3,434 4.8

No second largest item 412 0.6

Returns with expanded

income of

$200,000 or more

Total — —

Interest paid deduction — —

Tax-exempt interest (3) — —

Taxes paid deduction — —

Charitable contributions

deduction — —

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions — —

General business credit — —

All other tax credits — —

Partnership and S corporation

net losses — —

Foreign-earned income

exclusion (3) — —

No second largest item — —

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 681 34.2

Interest paid deduction 171 25.1

Investment interest expense

deduction (1) — —

Taxes paid deduction 153 22.5

Charitable contributions

deduction 168 24.7

Medical and dental expense

deduction ** **

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 36 5.3

All other tax credits (4) ** **

Partnership and S corporation

net losses 138 20.3

No second largest item ** **

Returns with expanded

income of

$200,000 or more

Total — —

Interest paid deduction — —

Tax-exempt interest (3) — —

Taxes paid deduction — —

Charitable contributions

deduction — —

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous deductions — —

All other tax credits (4) — —

Partnership and S corporation

net losses — —

Foreign-earned income

exclusion (3) — —

No second largest item

net losses — —

Item with the largest tax effect

Taxes paid

deduction

Number Percentage

Item with the second of of

largest tax effect returns total

(7) (8)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 1,464,724 56.4

Interest paid deduction 818,678 55.9

Investment interest expense

deduction (1) 48,426 3.3

Taxes paid deduction — —

Charitable contributions

deduction 459,579 31.4

Medical and dental expense

deduction 4,284 0.3

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 70,701 4.8

General business credit 7,090 0.5

All other tax credits 9,973 0.7

Partnership and S corporation

net losses 23,135 1.6

No second largest item 22,859 1.6

Returns with expanded

income of

$200,000 or more

Total 1,386,727 51.7

Interest paid deduction 819,335 59.1

Tax-exempt interest (3) 111,438 8.0

Taxes paid deduction — —

Charitable contributions

deduction 374,991 27.0

Medical and dental expense

deduction 3,578 0.3

Net casualty or theft loss

deduction 8 (2)

Total miscellaneous

deductions 19,368 1.4

General business credit 5,651 0.4

All other tax credits 9,153 0.7

Partnership and S corporation

net losses 19,371 1.4

Foreign-earned income

exclusion (3) 683 (2)

No second largest item 23,154 1.7

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 72 3.6

Interest paid deduction 12 16.7

Investment interest expense

deduction (1) 28 38.9

Taxes paid deduction — —

Charitable contributions

deduction 17 23.6

Medical and dental expense

deduction ** **

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions ** **

All other tax credits (4) ** **

Partnership and S corporation

net losses ** **

No second largest item — —

Returns with expanded

income of

$200,000 or more

Total 70 3.0

Interest paid deduction 4 5.7

Tax-exempt interest (3) 37 52.9

Taxes paid deduction — —

Charitable contributions

deduction 13 18.6

Medical and dental expense

deduction ** **

Net casualty or theft loss

deduction — —

Total miscellaneous deductions 6 8.6

All other tax credits (4) ** **

Partnership and S corporation

net losses 5 7.1

Foreign-earned income

exclusion (3) — —

No second largest item

net losses — —

Item with the largest tax effect

Charitable contributions

deduction

Number Percentage

Item with the second of of

largest tax effect returns total

(9) (10)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 233,186 9.0

Interest paid deduction 52,712 22.6

Investment interest expense

deduction (1) 7,345 3.1

Taxes paid deduction 152,108 65.2

Charitable contributions

deduction — —

Medical and dental expense

deduction 1,621 0.7

Net casualty or theft loss

deduction 8 (2)

Total miscellaneous

deductions 10,293 4.4

General business credit 2,520 1.1

All other tax credits 971 0.4

Partnership and S corporation

net losses 5,055 2.2

No second largest item 551 0.2

Returns with expanded

income of

$200,000 or more

Total 220,496 8.2

Interest paid deduction 53,450 24.2

Tax-exempt interest (3) 25,476 11.6

Taxes paid deduction 127,986 58.0

Charitable contributions

deduction — —

Medical and dental expense

deduction 1,094 0.5

Net casualty or theft loss

deduction 8 (2)

Total miscellaneous

deductions 5,041 2.3

General business credit 1,554 0.7

All other tax credits 950 0.4

Partnership and S corporation

net losses 4,399 2.0

Foreign-earned income

exclusion (3) 413 0.2

No second largest item 123 0.1

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 68 3.4

Interest paid deduction 12 17.6

Investment interest expense

deduction (1) ** **

Taxes paid deduction 5 7.4

Charitable contributions

deduction — —

Medical and dental expense

deduction 26 38.2

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 6 8.8

All other tax credits (4) ** **

Partnership and S corporation

net losses ** **

No second largest item — —

Returns with expanded

income of

$200,000 or more

Total 94 4.1

Interest paid deduction 16 17.0

Tax-exempt interest (3) 5 5.3

Taxes paid deduction 10 10.6

Charitable contributions

deduction — —

Medical and dental expense

deduction ** **

Net casualty or theft loss

deduction — —

Total miscellaneous deductions 9 9.6

All other tax credits (4) ** **

Partnership and S corporation

net losses 5 5.3

Foreign-earned income

exclusion (3) — —

No second largest item

net losses — —

Item with the largest tax effect

Medical and dental

expense deduction

Number Percentage

Item with the second of of

largest tax effect returns total

(11) (12)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 13,885 0.5

Interest paid deduction 1,343 9.7

Investment interest expense

deduction (1) 48 0.3

Taxes paid deduction 8,556 61.6

Charitable contributions

deduction 1,382 10.0

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 2,026 14.6

General business credit — —

All other tax credits 189 1.4

Partnership and S corporation

net losses 340 2.4

No second largest item — —

Returns with expanded

income of

$200,000 or more

Total 13,188 0.5

Interest paid deduction 1,157 8.8

Tax-exempt interest (3) 3,307 25.1

Taxes paid deduction 6,178 46.8

Charitable contributions

deduction 907 6.9

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 1,101 8.4

General business credit — —

All other tax credits 189 1.4

Partnership and S corporation

net losses 340 2.6

Foreign-earned income

exclusion (3) 8 0.1

No second largest item — —

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 176 8.8

Interest paid deduction 3 1.7

Investment interest expense

deduction (1) ** **

Taxes paid deduction 9 5.1

Charitable contributions

deduction 22 12.5

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction ** **

Total miscellaneous

deductions 12 6.8

All other tax credits (4) — —

Partnership and S corporation

net losses ** **

No second largest item ** **

Returns with expanded

income of

$200,000 or more

Total 357 15.4

Interest paid deduction 3 0.8

Tax-exempt interest (3) 67 18.8

Taxes paid deduction 8 2.2

Charitable contributions

deduction 16 4.5

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction 248 69.5

Total miscellaneous deductions 10 2.8

All other tax credits (4) — —

Partnership and S corporation

net losses ** **

Foreign-earned income

exclusion (3) ** **

No second largest item

net losses ** **

Item with the largest tax effect

Net casualty or theft

loss deduction

Number Percentage

Item with the second of of

largest tax effect returns total

(13) (14)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 1,083 (2)

Interest paid deduction 392 36.2

Investment interest expense

deduction (1) 5 0.5

Taxes paid deduction 678 62.6

Charitable contributions

deduction — —

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 8 0.7

General business credit — —

All other tax credits — —

Partnership and S corporation

net losses — —

No second largest item — —

Returns with expanded

income of

$200,000 or more

Total 19,03 (2)

Interest paid deduction 239 35.9

Tax-exempt interest (3) ** **

Taxes paid deduction 967 62.1

Charitable contributions

deduction ** **

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 16 1.5

General business credit — —

All other tax credits — —

Partnership and S corporation

net losses — —

Foreign-earned income

exclusion (3) — —

No second largest item — —

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 89 4.5

Interest paid deduction 21 23.6

Investment interest expense

deduction (1) 4 4.5

Taxes paid deduction 18 20.2

Charitable contributions

deduction 8 9.0

Medical and dental expense

deduction ** **

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 33 37.1

All other tax credits (4) — —

Partnership and S corporation

net losses 3 3.4

No second largest item ** **

Returns with expanded

income of

$200,000 or more

Total 99 4.3

Interest paid deduction 21 21.2

Tax-exempt interest (3) 7 7.1

Taxes paid deduction 14 14.1

Charitable contributions

deduction 7 7.1

Medical and dental expense

deduction ** **

Net casualty or theft loss

deduction — —

Total miscellaneous deductions ** **

All other tax credits (4) — —

Partnership and S corporation

net losses ** **

Foreign-earned income

exclusion (3) — —

No second largest item

net losses ** **

Item with the largest tax effect

Total miscellaneous

deductions

Number Percentage

Item with the second of of

largest tax effect returns total

(15) (16)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 72,342 2.8

Interest paid deduction 19,242 26.6

Investment interest expense

deduction (1) 1,566 2.2

Taxes paid deduction 40,251 55.6

Charitable contributions

deduction 8,044 11.1

Medical and dental expense

deduction 309 0.4

Net casualty or theft loss

deduction 8 (2)

Total miscellaneous

deductions — —

General business credit 229 0.3

All other tax credits 203 0.3

Partnership and S corporation

net losses 1,461 2.0

No second largest item 1,030 1.4

Returns with expanded

income of

$200,000 or more

Total 15,615 0.6

Interest paid deduction 1,936 12.4

Tax-exempt interest (3) 2,815 18.0

Taxes paid deduction 7,661 49.1

Charitable contributions

deduction 2,401 15.4

Medical and dental expense

deduction 155 1.0

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions — —

General business credit 18 0.1

All other tax credits 18 0.1

Partnership and S corporation

net losses 479 3.1

Foreign-earned income

exclusion (3) 10 0.1

No second largest item 122 0.8

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 421 21.1

Interest paid deduction 79 18.8

Investment interest expense

deduction (1) 12 2.9

Taxes paid deduction 117 27.8

Charitable contributions

deduction 21 5.0

Medical and dental expense

deduction 5 1.2

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions — —

All other tax credits (4) 4 1.0

Partnership and S corporation

net losses 109 25.9

No second largest item 74 17.6

Returns with expanded

income of

$200,000 or more

Total 27 1.2

Interest paid deduction ** **

Tax-exempt interest (3) 6 22.2

Taxes paid deduction 5 18.5

Charitable contributions

deduction 6 22.2

Medical and dental expense

deduction ** **

Net casualty or theft loss

deduction — —

Total miscellaneous deductions — —

All other tax credits (4) — —

Partnership and S corporation

net losses 5 18.5

Foreign-earned income

exclusion (3) — —

No second largest item

net losses — —

Item with the largest tax effect

General

business credit

Number Percentage

Item with the second of of

largest tax effect returns total

(17) (18)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 8,772 0.3

Interest paid deduction 1,620 18.5

Investment interest expense

deduction (1) 380 4.3

Taxes paid deduction 3,696 42.1

Charitable contributions

deduction 297 3.4

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 177 2.0

General business credit — —

All other tax credits 257 2.9

Partnership and S corporation

net losses 442 5.0

No second largest item 1,904 21.7

Returns with expanded

income of

$200,000 or more

Total 7,941 0.3

Interest paid deduction 1,546 19.5

Tax-exempt interest (3) ** **

Taxes paid deduction 3,323 41.8

Charitable contributions

deduction ** **

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 5 0.1

General business credit — —

All other tax credits 221 2.8

Partnership and S corporation

net losses 322 4.1

Foreign-earned income

exclusion (3) — —

No second largest item 1,201 15.1

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 215 10.8

Interest paid deduction 52 24.3

Investment interest expense

deduction (1) 32 15.0

Taxes paid deduction 84 39.3

Charitable contributions

deduction 16 7.5

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions ** **

All other tax credits (4) ** **

Partnership and S corporation

net losses 12 5.6

No second largest item 13 6.1

Returns with expanded

income of

$200,000 or more

Total 214 9.2

Interest paid deduction 68 31.8

Tax-exempt interest (3) ** **

Taxes paid deduction 92 43.0

Charitable contributions

deduction 17 7.9

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous deductions — —

All other tax credits (4) ** **

Partnership and S corporation

net losses ** **

Foreign-earned income

exclusion (3) — —

No second largest item

net losses ** **

Item with the largest tax effect

All other

tax credits

Number Percentage

Item with the second of of

largest tax effect returns total

(19) (20)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 25,515 1.0

Interest paid deduction 3,642 14.3

Investment interest expense

deduction (1) 2,199 8.6

Taxes paid deduction 10,827 42.4

Charitable contributions

deduction 962 3.8

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 131 0.5

General business credit 142 0.6

All other tax credits — —

Partnership and S corporation

net losses 349 1.4

No second largest item 7,264 28.5

Returns with expanded

income of

$200,000 or more

Total 22,984 0.9

Interest paid deduction 4,221 18.4

Tax-exempt interest (3) 2,113 9.2

Taxes paid deduction 10,987 47.8

Charitable contributions

deduction 899 3.9

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 66 0.3

General business credit 138 0.6

All other tax credits — —

Partnership and S corporation

net losses 290 1.3

Foreign-earned income

exclusion (3) 154 0.7

No second largest item 4,117 17.9

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 191 9.6

Interest paid deduction 13 6.8

Investment interest expense

deduction (1) 126 66.0

Taxes paid deduction 24 12.6

Charitable contributions

deduction 11 5.8

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction ** **

Total miscellaneous

deductions 10 5.2

All other tax credits (4) ** **

Partnership and S corporation

net losses — —

No second largest item — —

Returns with expanded

income of

$200,000 or more

Total 190 8.2

Interest paid deduction 5 2.6

Tax-exempt interest (3) 38 20.0

Taxes paid deduction ** **

Charitable contributions

deduction 9 4.7

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous deductions ** **

All other tax credits (4) 46 24.3

Partnership and S corporation

net losses — —

Foreign-earned income

exclusion (3) ** **

No second largest item

net losses — —

Item with the largest tax effect

Partnership and S

corporation net losses

Number Percentage

Item with the second of of

largest tax effect returns total

(21) (22)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total 90,592 3.5

Interest paid deduction 19,101 21.1

Investment interest expense

deduction (1) 6,055 6.7

Taxes paid deduction 36,542 40.3

Charitable contributions

deduction 6,834 7.5

Medical and dental expense

deduction 86 0.1

Net casualty or theft loss

deduction 3 (2)

Total miscellaneous

deductions 2,888 3.2

General business credit 645 0.7

All other tax credits 1,970 2.2

Partnership and S corporation

net losses 16,469 18.2

No second largest item

Returns with expanded

income of

$200,000 or more

Total 86,114 3.2

Interest paid deduction 19,650 22.8

Tax-exempt interest (3) 9,427 10.9

Taxes paid deduction 34,856 40.5

Charitable contributions

deduction 6,948 8.1

Medical and dental expense

deduction 86 0.1

Net casualty or theft loss

deduction 3 (2)

Total miscellaneous

deductions 1,003 1.2

General business credit 677 0.8

All other tax credits 2,163 2.5

Partnership and S corporation

net losses — —

Foreign-earned income

exclusion (3) 262 0.3

No second largest item 11,038 12.8

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total — —

Interest paid deduction — —

Investment interest expense

deduction (1) — —

Taxes paid deduction — —

Charitable contributions

deduction — —

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions — —

All other tax credits (4) — —

Partnership and S corporation

net losses — —

No second largest item — —

Returns with expanded

income of

$200,000 or more

Total 10 0.4

Interest paid deduction ** **

Tax-exempt interest (3) ** **

Taxes paid deduction ** **

Charitable contributions

deduction — —

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous deductions — —

All other tax credits (4) — —

Partnership and S corporation

net losses ** **

Foreign-earned income

exclusion (3) — —

No second largest item

net losses — —

Item with the largest tax effect

Foreign-earned

income exclusion (3)

Number Percentage

Item with the second of of

largest tax effect returns total

(23) (24)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total — —

Interest paid deduction — —

Investment interest expense

deduction (1) — —

Taxes paid deduction — —

Charitable contributions

deduction — —

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions — —

General business credit — —

All other tax credits — —

Partnership and S corporation

net losses — —

No second largest item

Returns with expanded

income of

$200,000 or more

Total 43,389 1.6

Interest paid deduction 11,120 25.6

Tax-exempt interest (3) 5,698 13.1

Taxes paid deduction 6,928 16.0

Charitable contributions

deduction 1,763 4.1

Medical and dental expense

deduction 151 0.3

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 369 0.9

General business credit 10 (2)

All other tax credits 2,409 5.6

Partnership and S corporation

net losses 1,304 3.0

Foreign-earned income

exclusion (3) — —

No second largest item 13,636 31.4

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total — —

Interest paid deduction — —

Investment interest expense

deduction (1) — —

Taxes paid deduction — —

Charitable contributions

deduction — —

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions — —

All other tax credits (4) — —

Partnership and S corporation

net losses — —

No second largest item — —

Returns with expanded

income of

$200,000 or more

Total 1,219 52.5

Interest paid deduction 130 10.7

Tax-exempt interest (3) — —

Taxes paid deduction 305 25.0

Charitable contributions

deduction 117 9.6

Medical and dental expense

deduction 346 28.4

Net casualty or theft loss

deduction 5 0.4

Total miscellaneous deductions 94 7.7

All other tax credits (4) ** **

Partnership and S corporation

net losses 157 12.9

Foreign-earned income

exclusion (3) ** **

No second largest item

net losses 53 4.4

Item with the largest tax effect

Tax-exempt

interest (3)

Number Percentage

Item with the second of of

largest tax effect returns total

(25) (26)

Returns with worldwide

income tax

Returns with adjusted

gross income

of $200,000 or more

Total — —

Interest paid deduction — —

Investment interest expense

deduction (1) — —

Taxes paid deduction — —

Charitable contributions

deduction — —

Medical and dental expense

deduction — —

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions — —

General business credit — —

All other tax credits — —

Partnership and S corporation

net losses — —

No second largest item

Returns with expanded

income of

$200,000 or more

Total 281,190 10.5

Interest paid deduction 17,869 6.4

Tax-exempt interest (3) — —

Taxes paid deduction 136,796 48.6

Charitable contributions

deduction 32,211 11.5

Medical and dental expense

deduction 2,772 1.0

Net casualty or theft loss

deduction — —

Total miscellaneous

deductions 12,087 4.3

General business credit 1,909 0.7

All other tax credits 4,099 1.5

Partnership and S corporation

net losses 11,738 4.2

Foreign-earned income

exclusion (3) 205 0.1

No second largest item 61,504 21.9

** Data deleted to avoid disclosure of information for specific

taxpayers. However, deleted data are included in the appropriate

totals.

(1) Investment interest expense deduction only has an effect when

using the adjusted gross income concept.

(2) Less than 0.05 percent

(3) Tax-exempt interest and foreign-earned income exclusion only have

an effect when using the expanded income concept

(4) General business credit has been combined with all other tax

credits.

NOTES: Detail may not add to totals because of rounding. Total columns

do not include returns with no tax effect.

Table 9.–Returns Without U.S. Income Tax and With Income of $200,000

or More Under Alternative Concepts: Number of Returns With Itemized

Deductions, Credits, and Tax Preferences, as Percentages of Income, Tax

Year 2000

[All figures are estimates based on samples]

No.

Income concept and type of Total deduction,

deduction, credit, or credit, or tax

tax preference preference

(1) (2)

Adjusted gross income concept

Total itemized deductions 2,328 126

Interest paid deduction:

Total 2,328 504

Investment interest per

income concept 2,328 894

Taxes paid deduction 2,328 279

Charitable contributions

deduction 2,328 515

Medical and dental expense

deduction 2,328 2,042

Net casualty or theft loss

deduction 2,328 2,226

Net limited miscellaneous

deduction per income

concept 2,328 1,536

Non-limited miscellaneous

deduction 2,328 1,824

Deduction equivalent of:

Total credits 2,328 1,726

Foreign tax credit 2,328 2,023

General business credit 2,328 2,278

Tax preferences excluded

from adjusted gross

income 2,328 1,485

Expanded Income concept

Total itemized deductions 2,766 445

Interest paid deduction:

Total: 2,766 1,655

Investment interest per

income concept 2,766 1,906

Taxes paid deduction 2,766 542

Charitable contributions

deduction 2,766 760

Medical and dental

expense deduction 2,766 1,642

Net casualty or theft

loss deduction 2,766 2,654

Net limited miscellaneous

deduction per income

concept 2,766 1,449

Non-limited miscellaneous

deduction 2,766 2,697

Deduction equivalent of:

Total credits 2,766 1,957

Foreign tax credit 2,766 2,321

General business credit 2,766 2,711

Tax preferences excluded

from adjusted gross

income 2,766 724

Number of returns on which income

was reduced by percentages

of income

Income concept and type of Under 10 percent 20 percent

deduction, credit, or 10 under under

tax preference percent 20 percent 30 percent

(3) (4) (5)

Adjusted gross income concept

Total itemized deductions 133 98 48

Interest paid deduction:

Total 533 123 71

Investment interest per

income concept 349 60 47

Taxes paid deduction 1,382 356 114

Charitable contributions

deduction 1,186 167 89

Medical and dental expense

deduction 45 14 6

Net casualty or theft loss

deduction ** ** —

Net limited miscellaneous

deduction per income

concept 478 156 53

Non-limited miscellaneous

deduction 46 7 11

Deduction equivalent of:

Total credits 103 28 14

Foreign tax credit 139 ** 3

General business credit 33 8 4

Tax preferences excluded

from adjusted gross

income 549 87 47

Expanded Income concept

Total itemized deductions 348 413 241

Interest paid deduction:

Total: 635 234 123

Investment interest per

income concept 549 79 49

Taxes paid deduction 1,561 404 94

Charitable contributions

deduction 1,448 201 115

Medical and dental

expense deduction 406 99 99

Net casualty or theft

loss deduction 3 3 **

Net limited miscellaneous

deduction per income

concept 926 219 75

Non-limited miscellaneous

deduction 49 8 4

Deduction equivalent of:

Total credits 146 33 69

Foreign tax credit 146 12 13

General business credit 37 8 5

Tax preferences excluded

from adjusted gross

income 272 81 77

Number of returns on which income

was reduced by percentages of income

Income concept and type of 30 percent 40 percent 50 percent

deduction, credit, or under under under

tax preference 40 percent 50 percent 60 percent

(6) (7) (8)

Adjusted gross income concept

Total itemized deductions 25 13 10

Interest paid deduction:

Total 54 57 78

Investment interest per

income concept 65 67 75

Taxes paid deduction 58 33 17

Charitable contributions

deduction 128 86 157

Medical and dental expense

deduction 4 16 15

Net casualty or theft loss

deduction ** — **

Net limited miscellaneous

deduction per income

concept 37 19 9

Non-limited miscellaneous

deduction 6 4 6

Deduction equivalent of:

Total credits 14 25 67

Foreign tax credit ** ** 5

General business credit ** ** —

Tax preferences excluded

from adjusted gross

income 32 16 15

Expanded Income concept

Total itemized deductions 140 147 122

Interest paid deduction:

Total: 62 15 9

Investment interest per

income concept 29 21 18

Taxes paid deduction 43 21 11

Charitable contributions

deduction 68 55 38

Medical and dental

expense deduction 80 83 69

Net casualty or theft

loss deduction ** ** **

Net limited miscellaneous

deduction per income

concept 35 18 12

Non-limited miscellaneous

deduction ** ** —

Deduction equivalent of:

Total credits 28 51 104

Foreign tax credit 17 29 48

General business credit ** ** —

Tax preferences excluded

from adjusted gross

income 87 109 194

Number of returns on which income

was reduced by percentages of income

Income concept and type of 60 percent 70 percent 100 percent

deduction, credit, or under under or

tax preference 70 percent 100 percent more

(9) (10) (11)

Adjusted gross income concept

Total itemized deductions 12 206 1,657

Interest paid deduction:

Total 88 422 398

Investment interest per

income concept 96 391 284

Taxes paid deduction 13 33 43

Charitable contributions

deduction — — —

Medical and dental expense

deduction 26 70 90

Net casualty or theft loss

deduction — 26 71

Net limited miscellaneous

deduction per income

concept 9 16 15

Non-limited miscellaneous

deduction 6 166 252

Deduction equivalent of:

Total credits 95 256 —

Foreign tax credit 14 138 —

General business credit — — —

Tax preferences excluded

from adjusted gross

income 15 27 55

Expanded Income concept

Total itemized deductions 133 282 495

Interest paid deduction:

Total: 6 20 7

Investment interest per

income concept 14 26 75

Taxes paid deduction 7 32 51

Charitable contributions

deduction 18 36 27

Medical and dental

expense deduction 76 126 86

Net casualty or theft

loss deduction ** 21 78

Net limited miscellaneous

deduction per income

concept 5 14 13

Non-limited miscellaneous

deduction — — 4

Deduction equivalent of:

Total credits 146 232 —

Foreign tax credit 67 113 —

General business credit — — —

Tax preferences excluded

from adjusted gross

income 140 848 234

** Data deleted to avoid disclosure of information for specific

taxpayers. However, deleted data are included in the appropriate

totals.

NOTE: Detail may not add to totals because of rounding.

Table 10.–Returns Without Worldwide Income Tax and With Income of

$200,000 or More Under Alternative Concepts: Number of Returns With

Itemized Deductions, Credits, and Tax Preferences, as Percentages of

Income, Tax Year 2000

[All figures are estimates based on samples]

No.

deduction,

Income concept and type of deduction, Total credit, or tax

credit, or tax preference preference

Adjusted gross income concept (1) (2)

Total itemized deductions 2,022 15

Interest paid deduction:

Total 2,022 373

Investment interest per income concept 2,022 718

Taxes paid deduction 2,022 149

Charitable contributions deduction 2,022 374

Medical and dental expense deduction 2,022 1,747

Net casualty or theft loss deduction 2,022 1,921

Net limited miscellaneous deduction per

income concept 2,022 1,277

Non-limited miscellaneous deduction 2,022 1,525

Deduction equivalent of:

Total credits 2,022 1,726

Foreign tax credit 2,022 2,022

General business credit 2,022 1,992

Tax preferences excluded from adjusted

gross income 2,022 1,263

Expanded Income concept

Total itemized deductions 2,320 231

Interest paid deduction:

Total 2,320 1,369

Investment interest per income concept 2,320 1,560

Taxes paid deduction 2,320 299

Charitable contributions deduction 2,320 498

Medical and dental expense deduction 2,320 1,226

Net casualty or theft loss deduction 2,320 2,210

Net limited miscellaneous deduction per

income concept 2,320 1,066

Non-limited miscellaneous deduction 2,320 2,256

Deduction equivalent of:

Total credits 2,320 1,956

Foreign tax credit 2,320 2,320

General business credit 2,320 2,286

Tax preferences excluded from adjusted

gross income 2,320 396

Number of returns on

which income was

reduced by percentage

of income

Income concept and type of deduction, Under 10 percent

credit, or tax preference 10 under

percent 20 percent

Adjusted gross income concept (3) (4)

Total itemized deductions 76 77

Interest paid deduction:

Total 450 106

Investment interest per income concept 285 50

Taxes paid deduction 1,246 333

Charitable contributions deduction 1,065 155

Medical and dental expense deduction 42 13

Net casualty or theft loss deduction ** **

Net limited miscellaneous deduction per

income concept 443 147

Non-limited miscellaneous deduction 42 7

Deduction equivalent of:

Total credits 45 18

Foreign tax credit — —

General business credit 19 5

Tax preferences excluded from adjusted

gross income 485 80

Expanded Income concept

Total itemized deductions 259 365

Interest paid deduction:

Total 531 199

Investment interest per income concept 477 74

Taxes paid deduction 1,403 377

Charitable contributions deduction 1,312 182

Medical and dental expense deduction 389 96

Net casualty or theft loss deduction 3 3

Net limited miscellaneous deduction per

income concept 873 213

Non-limited miscellaneous deduction 45 7

Deduction equivalent of:

Total credits 81 8

Foreign tax credit — —

General business credit 25 **

Tax preferences excluded from adjusted

gross income 215 71

Number of returns on

which income was

reduced by percentage

of income

Income concept and type of deduction, 20 percent 30 percent

credit, or tax preference under under

30 percent 40 percent

Adjusted gross income concept (5) (6)

Total itemized deductions 34 11

Interest paid deduction:

Total 61 43

Investment interest per income concept 39 58

Taxes paid deduction 105 52

Charitable contributions deduction 80 119

Medical and dental expense deduction 5 4

Net casualty or theft loss deduction — **

Net limited miscellaneous deduction per

income concept 52 36

Non-limited miscellaneous deduction 10 5

Deduction equivalent of:

Total credits 7 7

Foreign tax credit — —

General business credit 3 **

Tax preferences excluded from adjusted

gross income 43 30

Expanded Income concept

Total itemized deductions 212 128

Interest paid deduction:

Total 113 54

Investment interest per income concept 40 27

Taxes paid deduction 87 37

Charitable contributions deduction 107 63

Medical and dental expense deduction 95 79

Net casualty or theft loss deduction ** **

Net limited miscellaneous deduction per

income concept 72 35

Non-limited miscellaneous deduction 4 **

Deduction equivalent of:

Total credits 52 8

Foreign tax credit — —

General business credit 3 3

Tax preferences excluded from adjusted

gross income 74 86

Number of returns on

which income was

reduced by percentage

of income

Income concept and type of deduction, 40 percent 50 percent

credit, or tax preference under under

50 percent 60 percent

Adjusted gross income concept (7) (8)

Total itemized deductions 5 5

Interest paid deduction:

Total 47 72

Investment interest per income concept 62 72

Taxes paid deduction 33 17

Charitable contributions deduction 80 149

Medical and dental expense deduction 15 15

Net casualty or theft loss deduction — **

Net limited miscellaneous deduction per

income concept 18 9

Non-limited miscellaneous deduction 4 6

Deduction equivalent of:

Total credits 11 42

Foreign tax credit — —

General business credit ** —

Tax preferences excluded from adjusted

gross income 16 14

Expanded Income concept

Total itemized deductions 134 113

Interest paid deduction:

Total 14 8

Investment interest per income concept 21 15

Taxes paid deduction 20 10

Charitable contributions deduction 47 37

Medical and dental expense deduction 83 67

Net casualty or theft loss deduction ** —

Net limited miscellaneous deduction per

income concept 18 12

Non-limited miscellaneous deduction ** —

Deduction equivalent of:

Total credits 9 38

Foreign tax credit — —

General business credit ** —

Tax preferences excluded from adjusted

gross income 103 186

Number of returns on

which income was

reduced by percentage

of income

Income concept and type of 60 percent 70 percent 100

deduction, under under 100 percent

credit, or tax preference 70 percent percent or more

Adjusted gross income concept (9) (10) (11)

Total itemized deductions 7 136 1,656

Interest paid deduction:

Total 84 388 389

Investment interest per

income concept 91 363 284

Taxes paid deduction 12 32 43

Charitable contributions

deduction — — —

Medical and dental expense

deduction 25 66 90

Net casualty or theft loss

deduction — 25 71

Net limited miscellaneous

deduction per income

concept 9 16 15

Non-limited miscellaneous

deduction 6 165 252

Deduction equivalent of:

Total credits 68 98 —

Foreign tax credit — — —

General business credit — — —

Tax preferences excluded from

adjusted gross income 15 26 50

Expanded Income concept

Total itemized deductions 130 259 489

Interest paid deduction:

Total 6 19 7

Investment interest per

income concept 12 24 70

Taxes paid deduction 6 30 51

Charitable contributions

deduction 15 32 27

Medical and dental expense

deduction 74 125 86

Net casualty or theft loss

deduction ** 20 78

Net limited miscellaneous

deduction per income

concept 5 13 13

Non-limited miscellaneous

deduction — — 4

Deduction equivalent of:

Total credits 65 103 —

Foreign tax credit — — —

General business credit — — —

Tax preferences excluded from

adjusted gross income 137 819 233

** Data deleted to avoid disclosure of information for specific

taxpayers. However, deleted data are included in the appropriate

totals.

NOTE: Detail may not add to totals because of rounding.

Table 11.–Returns With and Without U.S. Income Tax: Number and

Percentages of Returns, by Effective Tax Rate, and by Size of Income

Under Alternative Concepts, Tax Year 2000

[All figures are estimates based on samples]

Total

Tax status, effective tax rate Number Percentage

or of

returns total

(1) (2)

All returns 129,373,500 100.0

Returns without U.S. income tax 29,208,066 22.6

Returns with U.S. income tax 100,165,434 77.4

Effective tax rate:

Under 5 percent 19,215,207 14.9

5 under 10 percent 36,386,666 28.1

10 under 15 percent 27,976,551 21.6

15 under 20 percent 12,060,252 9.3

20 under 25 percent 3,183,818 2.5

25 under 30 percent 881,189 0.7

30 under 35 percent 352,989 0.3

35 under 40 percent 85,022 0.1

40 under 45 percent 3,371 (2)

45 under 50 percent 2,786 (2)

50 under 60 percent 5,137 (2)

60 under 70 percent 1,051 (2)

70 under 80 percent 802 (2)

80 percent or more 10,592 (2)

Size of adjusted gross

income

Under $50,000 (1)

Tax status, effective tax rate Number Percentage

of of

returns total

(3) (4)

All returns 92,844,989 100.0

Returns without U.S. income tax 29,068,195 31.3

Returns with U.S. income tax 63,776,794 68.7

Effective tax rate:

Under 5 percent 18,147,487 19.5

5 under 10 percent 28,536,812 30.7

10 under 15 percent 15,191,383 16.4

15 under 20 percent 1,741,269 1.9

20 under 25 percent 113,357 0.1

25 under 30 percent 20,599 (2)

30 under 35 percent 13,583 (2)

35 under 40 percent 2,929 (2)

40 under 45 percent 8 (2)

45 under 50 percent 7 (2)

50 under 60 percent 2,036 (2)

60 under 70 percent 356 (2)

70 under 80 percent 51 (2)

80 percent or more 6,918 (2)

Size of adjusted gross

income

$50,000 under $100,000

Tax status, effective tax rate Number Percentage

of of

returns total

(5) (6)

All returns 25,673,487 100.0

Returns without U.S. income tax 131,965 0.5

Returns with U.S. income tax 25,541,521 99.5

Effective tax rate:

Under 5 percent 999,617 3.9

5 under 10 percent 7,608,533 29.6

10 under 15 percent 10,834,200 42.2

15 under 20 percent 5,458,244 21.3

20 under 25 percent 637,003 2.5

25 under 30 percent 1,366 (2)

30 under 35 percent 1,011 (2)

35 under 40 percent 48 (2)

40 under 45 percent 152 (2)

45 under 50 percent 1,042.0 (2)

50 under 60 percent 277 (2)

60 under 70 percent 3 (2)

70 under 80 percent 11 (2)

80 percent or more 15 (2)

Size of adjusted gross

income

$100,000 under $200,000

Tax status, effective tax rate Number Percentage

of of

returns total

(7) (8)

All returns 8,083,447 100.0

Returns without U.S. income tax 5,578 0.1

Returns with U.S. income tax 8,077,869 99.9

Effective tax rate:

Under 5 percent 52,140 0.6

5 under 10 percent 224,313 2.8

10 under 15 percent 1,885,379 23.3

15 under 20 percent 4,471,438 55.3

20 under 25 percent 1,340,566 16.6

25 under 30 percent 93,045 1.2

30 under 35 percent 3,355 (2)

35 under 40 percent 2,742 (2)

40 under 45 percent 704 (2)

45 under 50 percent 403 (2)

50 under 60 percent 1,197 (2)

60 under 70 percent 42 (2)

70 under 80 percent 353 (2)

80 percent or more 2,191 (2)

Size of adjusted gross

income

$200,000 more

Tax status, effective tax rate Number Percentage

of of

returns total

(9) (10)

All returns 2,771,577 100.0

Returns without U.S. income tax 2,328 0.1

Returns with U.S. income tax 2,769,249 99.9

Effective tax rate:

Under 5 percent 15,962 0.6

5 under 10 percent 17,007 0.6

10 under 15 percent 65,589 2.4

15 under 20 percent 389,302 14.0

20 under 25 percent 1,092,892 39.4

25 under 30 percent 766,179 27.6

30 under 35 percent 335,040 12.1

35 under 40 percent 79,303 2.9

40 under 45 percent 2,507 0.1

45 under 50 percent 1,335 (2)

50 under 60 percent 1,627 0.1

60 under 70 percent 650 (2)

70 under 80 percent 387 (2)

80 percent or more 1,469 0.1

Total

Tax status, effective tax rate Number Percentage

or of

returns total

(11) (12)

All returns 129,373,500 100.0

Returns without U.S. income tax 29,208,066 22.6

Returns with U.S. income tax 100,165,434 77.4

Effective tax rate:

Under 5 percent 20,296,533 15.7

5 under 10 percent 35,665,423 27.6

10 under 15 percent 27,593,098 21.3

15 under 20 percent 12,089,817 9.3

20 under 25 percent 3,167,816 2.4

25 under 30 percent 895,038 0.7

30 under 35 percent 348,477 0.3

35 under 40 percent 84,372 0.1

40 under 45 percent 3,762 (2)

45 under 50 percent 3,577 (2)

50 under 60 percent 3,493 (2)

60 under 70 percent 1,242 (2)

70 under 80 percent 394 (2)

80 percent or more 12,392 (2)

Size of expanded income

Under $50,000 (1)

Tax status, effective tax rate Number Percentage

of of

returns total

(13) (14)

All returns 92,241,597 100.0

Returns without U.S. income tax 29,003,531 31.4

Returns with U.S. income tax 63,238,066 68.6

Effective tax rate:

Under 5 percent 19,169,480 20.8

5 under 10 percent 27,296,399 29.6

10 under 15 percent 14,863,699 16.1

15 under 20 percent 1,746,414 1.9

20 under 25 percent 116,180 0.1

25 under 30 percent 21,596 (2)

30 under 35 percent 11,594 (2)

35 under 40 percent 2,892 (2)

40 under 45 percent 20 (2)

45 under 50 percent 1,011 (2)

50 under 60 percent 10 (2)

60 under 70 percent 358 (2)

70 under 80 percent 51 (2)

80 percent or more 8,362 (2)

Size of expanded income

$50,000 under $100,000

Tax status, effective tax rate Number Percentage

of of

returns total

(15) (16)

All returns 26,290,390 100.0

Returns without U.S. income tax 180,616 0.7

Returns with U.S. income tax 26,109,775 99.3

Effective tax rate:

Under 5 percent 1,022,275 3.9

5 under 10 percent 8,116,193 30.9

10 under 15 percent 10,874,496 41.4

15 under 20 percent 5,429,916 20.7

20 under 25 percent 657,352 2.5

25 under 30 percent 3,362 (2)

30 under 35 percent 1,988 (2)

35 under 40 percent 2,033 (2)

40 under 45 percent 152 (2)

45 under 50 percent 1,480.0 (2)

50 under 60 percent 829 (2)

60 under 70 percent 3 (2)

70 under 80 percent 8 (2)

80 percent or more 20 (2)

Size of expanded income

$100,000 under $200,000

Tax status, effective tax rate Number Percentage

of of

returns total

(17) (18)

All returns 8,033,709 100.0

Returns without U.S. income tax 21,153 0.3

Returns with U.S. income tax 8,012,556 99.7

Effective tax rate:

Under 5 percent 75,116 0.9

5 under 10 percent 219,911 2.7

10 under 15 percent 1,775,418 22.1

15 under 20 percent 4,503,416 56.1

20 under 25 percent 1,320,751 16.4

25 under 30 percent 107,250 1.3

30 under 35 percent 3,397 (2)

35 under 40 percent 2,402 (2)

40 under 45 percent 1,041 (2)

45 under 50 percent 562 (2)

50 under 60 percent 709 (2)

60 under 70 percent 42 (2)

70 under 80 percent 11 (2)

80 percent or more 2,530 (2)

Size of expanded income

$200,000 more

Tax status, effective tax rate Number Percentage

of of

returns total

(19) (20)

All returns 2,807,804 100.0

Returns without U.S. income tax 2,766 0.1

Returns with U.S. income tax 2,806,037 99.9

Effective tax rate:

Under 5 percent 29,661 1.1

5 under 10 percent 32,921 1.2

10 under 15 percent 79,486 2.8

15 under 20 percent 410,072 14.6

20 under 25 percent 1,073,533 38.2

25 under 30 percent 762,829 27.2

30 under 35 percent 331,498 11.8

35 under 40 percent 77,046 2.7

40 under 45 percent 2,549 0.1

45 under 50 percent 855 (2)

50 under 60 percent 1,945 0.1

60 under 70 percent 839 (2)

70 under 80 percent 324 (2)

80 percent or more 1,479 0.1

(1) Includes returns with adjusted gross deficit or with negative

expanded income.

(2) Less than 0.05 percent.

NOTE: Detail may not add to totals because of rounding.

Table 12.–Returns With and Without Worldwide Income Tax: Number and

Percentages of Returns, by Effective Tax Rate, and by Size of Income

Under Alternative Concepts, Tax Year 2000

[All figures are estimates based on samples]

Total

Tax status, effective tax rate Number Percentage

or of

returns total

(1) (2)

All returns 129,373,500 100.0

Returns without worldwide income tax 29,149,907 22.5

Returns with worlwide income tax 100,223,593 77.5

Effective tax rate:

Under 5 percent 19,179,585 14.8

5 under 10 percent 36,384,355 28.1

10 under 15 percent 27,972,673 21.6

15 under 20 percent 12,079,324 9.3

20 under 25 percent 3,190,897 2.5

25 under 30 percent 901,423 0.7

30 under 35 percent 367,035 0.3

35 under 40 percent 99,988 0.1

40 under 45 percent 11,121 (2)

45 under 50 percent 8,253 (2)

50 under 60 percent 9,152 (2)

60 under 70 percent 4,046 (2)

70 under 80 percent 1,142 (2)

80 percent or more 14,599 (2)

Size of adjusted gross

income

Under $50,000 (1)

Tax status, effective tax rate Number Percentage

of of

returns total

(3) (4)

All returns 92,844,989 100.0

Returns without worldwide income tax 29,019,095 31.3

Returns with worldwide income tax 63,825,894 68.7

Effective tax rate:

Under 5 percent 18,144,433 19.5

5 under 10 percent 28,552,757 30.8

10 under 15 percent 15,210,026 16.4

15 under 20 percent 1,748,881 1.9

20 under 25 percent 113,357 0.1

25 under 30 percent 20,599 (2)

30 under 35 percent 13,583 (2)

35 under 40 percent 3,911 (2)

40 under 45 percent 1,328 (2)

45 under 50 percent 344 (2)

50 under 60 percent 2,710 (2)

60 under 70 percent 2,657 (2)

70 under 80 percent 388 (2)

80 percent or more 10,919 (2)

Size of adjusted gross

income

$50,000 under $100,000

Tax status, effective tax rate Number Percentage

of of

returns total

(5) (6)

All returns 25,673,487 100.0

Returns without worldwide income tax 123,833 0.5

Returns with worldwide income tax 25,549,654 99.5

Effective tax rate:

Under 5 percent 991,238 3.9

5 under 10 percent 7,604,090 29.6

10 under 15 percent 10,828,024 42.2

15 under 20 percent 5,474,049 21.3

20 under 25 percent 638,659 2.5

25 under 30 percent 4,826 (2)

30 under 35 percent 2,511 (2)

35 under 40 percent 1,706 (2)

40 under 45 percent 490 (2)

45 under 50 percent 2,059 (2)

50 under 60 percent 1,291 (2)

60 under 70 percent 681 (2)

70 under 80 percent 12 (2)

80 percent or more 19 (2)

Size of adjusted gross

income

$100,000 under $200,000

Tax status, effective tax rate Number Percentage

of of

returns total

(7) (8)

All returns 8,083,447 100.0

Returns without worldwide income tax 4,957 0.1

Returns with worldwide income tax 8,078,490 99.9

Effective tax rate:

Under 5 percent 36,196 0.4

5 under 10 percent 215,587 2.7

10 under 15 percent 1,874,748 23.2

15 under 20 percent 4,473,270 55.3

20 under 25 percent 1,351,896 16.7

25 under 30 percent 101,492 1.3

30 under 35 percent 7,495 0.1

35 under 40 percent 6,410 0.1

40 under 45 percent 3,622 (2)

45 under 50 percent 2,550 (2)

50 under 60 percent 2,633 (2)

60 under 70 percent 47 (2)

70 under 80 percent 354 (2)

80 percent or more 2,191 (2)

Size of adjusted gross

income

$200,000 or more

Tax status, effective tax rate Number Percentage

of of

returns total

(9) (10)

All returns 2,771,577 100.0

Returns without worldwide income tax 2,022 0.1

Returns with worldwide income tax 2,769,555 99.9

Effective tax rate:

Under 5 percent 7,717 0.3

5 under 10 percent 11,922 0.4

10 under 15 percent 59,875 2.2

15 under 20 percent 383,123 13.8

20 under 25 percent 1,086,985 39.2

25 under 30 percent 774,507 27.9

30 under 35 percent 343,447 12.4

35 under 40 percent 87,961 3.2

40 under 45 percent 5,682 0.2

45 under 50 percent 3,301 0.1

50 under 60 percent 2,518 0.1

60 under 70 percent 660 (2)

70 under 80 percent 388 (2)

80 percent or more 1,470 0.1

Total

Tax status, effective tax rate Number Percentage

or of

returns total

(11) (12)

All returns 129,373,500 100.0

Returns without worldwide income tax 29,149,907 22.5

Returns with worldwide income tax 100,223,593 77.5

Effective tax rate:

Under 5 percent 20,256,734 15.7

5 under 10 percent 35,666,232 27.6

10 under 15 percent 27,597,505 21.3

15 under 20 percent 12,120,891 9.4

20 under 25 percent 3,182,194 2.5

25 under 30 percent 920,592 0.7

30 under 35 percent 361,061 0.3

35 under 40 percent 92,620 0.1

40 under 45 percent 4,478 (2)

45 under 50 percent 3,639 (2)

50 under 60 percent 3,538 (2)

60 under 70 percent 1,251 (2)

70 under 80 percent 395 (2)

80 percent or more 12,463 (2)

Size of expanded

income

Under $50,000 (1)

Tax status, effective tax rate Number Percentage

of of

returns total

(13) (14)

All returns 92,241,597 100.0

Returns without worldwide income tax 28,964,115 31.4

Returns with worldwide income tax 63,277,483 68.6

Effective tax rate:

Under 5 percent 19,169,977 20.8

5 under 10 percent 27,316,468 29.6

10 under 15 percent 14,879,470 16.1

15 under 20 percent 1,749,423 1.9

20 under 25 percent 116,179 0.1

25 under 30 percent 21,597 (2)

30 under 35 percent 11,594 (2)

35 under 40 percent 2,892 (2)

40 under 45 percent 20 (2)

45 under 50 percent 1,011 (2)

50 under 60 percent 10 (2)

60 under 70 percent 358 (2)

70 under 80 percent 51 (2)

80 percent or more 8,432 (2)

Size of expanded

income

$50,000 under $100,000

Tax status, effective tax rate Number Percentage

of of

returns total

(15) (16)

All returns 26,290,390 100.0

Returns without worldwide income tax 170,298 0.6

Returns with worldwide income tax 26,120,092 99.4

Effective tax rate:

Under 5 percent 1,018,738 3.9

5 under 10 percent 8,112,518 30.9

10 under 15 percent 10,868,233 41.3

15 under 20 percent 5,450,585 20.7

20 under 25 percent 657,527 2.5

25 under 30 percent 5,326 (2)

30 under 35 percent 2,970 (2)

35 under 40 percent 2,033 (2)

40 under 45 percent 152 (2)

45 under 50 percent 1,148 (2)

50 under 60 percent 829 (2)

60 under 70 percent 3 (2)

70 under 80 percent 8 (2)

80 percent or more 21 (2)

Size of expanded

income

$100,000 under $200,000

Tax status, effective tax rate Number Percentage

of of

returns total

(17) (18)

All returns 8,033,709 100.0

Returns without worldwide income tax 13,173 0.2

Returns with worldwide income tax 8,020,536 99.8

Effective tax rate:

Under 5 percent 56,010 0.7

5 under 10 percent 213,502 2.7

10 under 15 percent 1,775,317 22.1

15 under 20 percent 4,516,244 56.2

20 under 25 percent 1,332,286 16.6

25 under 30 percent 114,796 1.4

30 under 35 percent 4,745 0.1

35 under 40 percent 2,739 (2)

40 under 45 percent 1,042 (2)

45 under 50 percent 562 (2)

50 under 60 percent 709 (2)

60 under 70 percent 42 (2)

70 under 80 percent 11 (2)

80 percent or more 2,530 (2)

Size of expanded

income

$200,000 or more

Tax status, effective tax rate Number Percentage

of of

returns total

(19) (20)

All returns 2,807,804 100.0

Returns without worldwide income tax 2,320 0.1

Returns with worldwide income tax 2,805,483 99.9

Effective tax rate:

Under 5 percent 12,008 0.4

5 under 10 percent 23,744 0.8

10 under 15 percent 74,485 2.7

15 under 20 percent 404,638 14.4

20 under 25 percent 1,076,203 38.3

25 under 30 percent 778,873 27.7

30 under 35 percent 341,751 12.2

35 under 40 percent 84,957 3.0

40 under 45 percent 3,265 0.1

45 under 50 percent 917 (2)

50 under 60 percent 1,990 0.1

60 under 70 percent 849 (2)

70 under 80 percent 325 (2)

80 percent or more 1,479 0.1

(1) Includes returns with adjusted gross deficit or with negative

expanded income.

(2) Less than 0.05 percent.

NOTE: Detail may not add to totals because of rounding.

Figure A

All Returns and Returns with Income of $200,000 or More Measured in

Current Dollars and in 1976 Constant Dollars, by Income Concept, Tax

Years 1977-2000

$200,000 income threshold

measured in current

dollars

Number of returns

by income concept

Adjusted Expanded

Tax year All returns gross income income

(1) (2) (3)

1977 86,634,640 53,403 67,580

1978 89,771,551 68,506 85,137

1979 92,694,302 93,731 122,231

1980 93,902,459 117,250 149,826

1981 95,396,123 138,136 175,092

1982 95,337,432 169,367 207,291

1983 96,321,310 198,608 249,319

1984 99,438,708 243,760 310,042

1985 101,660,287 296,507 370,340

1986 103,045,170 374,363 529,460

1987 106,996,270 539,967 557,848

1988 109,708,280 725,345 737,659

1989 112,135,673 786,063 814,152

1990 113,717,138 834,957 860,940

1991 114,730,123 846,707 892,178

1992 113,604,503 954,747 989,522

1993 114,601,819 993,326 1,043,213

1994 115,943,131 1,109,498 1,153,829

1995 118,218,327 1,272,508 1,319,382

1996 120,351,208 1,523,407 1,572,114

1997 122,421,991 1,807,900 1,854,031

1998 124,770,662 2,085,211 2,132,301

1999 127,075,145 2,429,942 2,479,556

2000 129,373,500 2,771,577 2,807,804

$200,000 income

threshold measured

in current dollars

Percentage of all

returns by income, Current dollar

concept income threshold

equal to $200,000 in

Adjusted Expanded 1976 constant dollars

Tax year gross income income (whole dollars)

(4) (5) (6)

1977 0.060 0.076 213,005

1978 0.076 0.095 229,174

1979 0.101 0.132 255,184

1980 0.125 0.160 289,631

1981 0.143 0.182 319,508

1982 0.178 0.217 339,192

1983 0.206 0.259 350,088

1984 0.245 0.312 365,202

1985 0.292 0.364 378,207

1986 0.363 0.514 385,237

1987 0.505 0.521 399,297

1988 0.661 0.672 415,817

1989 0.701 0.726 435,852

1990 0.734 0.757 459,400

1991 0.738 0.778 478,735

1992 0.840 0.871 493,146

1993 0.867 0.910 507,909

1994 0.957 0.995 520,914

1995 1.076 1.116 535,677

1996 1.266 1.306 551,494

1997 1.477 1.514 564,148

1998 1.671 1.709 572,934

1999 1.912 1.951 585,589

2000 2.142 2.170 605,272

$20,000 income threshold measured in 1976 constant

dollars (1)

Percentage of all

Number returns by income

Tax year by income concept concept

Adjusted Expanded Adjusted Expanded

gross income income gross income income

(7) (8) (9) (10)

1977 45,931 58,991 0.053 0.068

1978 49,388 62,556 0.055 0.070

1979 55,542 76,479 0.060 0.083

1980 52,512 71,704 0.056 0.076

1981 50,880 71,146 0.053 0.075

1982 59,411 81,297 0.062 0.085

1983 67,310 93,977 0.070 0.098

1984 80,800 116,389 0.081 0.117

1985 95,740 134,715 0.094 0.133

1986 119,550 191,596 0.116 0.186

1987 161,408 169,942 0.151 0.159

1988 235,051 241,201 0.214 0.220

1989 217,685 228,530 0.194 0.204

1990 216,716 228,659 0.191 0.201

1991 183,442 195,743 0.160 0.171

1992 213,783 227,354 0.188 0.200

1993 201,236 212,853 0.176 0.186

1994 204,532 214,673 0.176 0.185

1995 237,770 248,077 0.201 0.210

1996 278,342 288,194 0.231 0.239

1997 335,040 345,869 0.274 0.283

1998 385,183 396,207 0.309 0.318

1999 436,118 446,583 0.343 0.351

2000 482,396 492,589 0.373 0.381

(1) 1976 constant dollars were calculated using the U.S. Bureau of

Labor Statistics’ consumer price index for urban consumers. See

footnote 6 of this article for further details.

Figure C

Nontaxable Returns with Income of $200,000 or More Measured in Current

Dollars and in 1976 Constant Dollars, by Tax Status and Income

Concept, Tax Years 1977-2000

$200,000 income threshold measured in current

dollars

Number of nontaxable returns with income of $200,000

or more

Returns with no U.S. Returns with no

income tax, by income worldwide income tax,

Tax year concept by income concept

Adjusted Expanded Adjusted Expanded

gross income income gross income income

(1) (2) (3) (4)

1977 60 85 37 64

1978 98 105 60 67

1979 70 114 28 64

1980 143 198 56 114

1981 226 304 79 114

1982 262 299 109 153

1983 447 579 321 437

1984 532 325 471 271

1985 612 613 442 454

1986 659 595 437 379

1987 857 472 740 364

1988 822 397 731 309

1989 1,081 779 987 691

1990 1,219 1,183 1,114 1,087

1991 1,253 1,933 1,131 1,740

1992 909 1,896 823 1,799

1993 1,022 2,392 932 1,950

1994 1,137 2,574 1,061 2,161

1995 998 2,676 896 1,746

1996 1,044 1,820 950 1,660

1997 1,189 1,814 1,048 1,562

1998 1,467 2,224 1,283 1,914

1999 1,605 2,525 1,398 2,174

2000 2,328 2,766 2,022 2,320

$200,000 income threshold measured in current

dollars

Percentage of all returns with income of $200,000

or more

Returns with no U.S. Returns with no

income tax, by income worldwide income tax,

Tax year concept by income concept

Adjusted Expanded Adjusted Expanded

gross income income gross income income

(5) (6) (7) (8)

1977 0.112 0.126 0.069 0.095

1978 0.143 0.123 0.088 0.079

1979 0.075 0.093 0.030 0.052

1980 0.122 0.132 0.048 0.076

1981 0.164 0.174 0.057 0.065

1982 0.155 0.144 0.064 0.074

1983 0.225 0.232 0.162 0.175

1984 0.218 0.105 0.193 0.087

1985 0.206 0.166 0.149 0.123

1986 0.176 0.112 0.117 0.072

1987 0.159 0.085 0.137 0.065

1988 0.113 0.054 0.101 0.042

1989 0.138 0.096 0.126 0.085

1990 0.146 0.137 0.133 0.126

1991 0.148 0.217 0.134 0.195

1992 0.095 0.192 0.086 0.182

1993 0.103 0.229 0.094 0.187

1994 0.102 0.223 0.096 0.187

1995 0.078 0.203 0.070 0.132

1996 0.069 0.116 0.062 0.106

1997 0.066 0.098 0.058 0.084

1998 0.070 0.104 0.062 0.090

1999 0.067 0.102 0.058 0.088

2000 0.084 0.099 0.073 0.083

$200,000 income threshold measured in 1976 constant

dollars (1)

Number of nontaxable returns with income of $200,000

or more

Returns with no U.S. Returns with no

income tax, by income worldwide income tax,

Tax year concept by income concept

Adjusted Expanded Adjusted Expanded

gross income income gross income income

(9) (10) (11) (12)

1977 54 75 32 56

1978 62 70 31 39

1979 38 71 15 39

1980 56 71 22 39

1981 53 87 21 55

1982 58 68 27 36

1983 138 135 113 108

1984 170 78 160 66

1985 190 155 137 99

1986 201 189 138 120

1987 312 126 271 85

1988 277 141 251 116

1989 293 128 269 106

1990 339 169 307 137

1991 301 305 273 277

1992 171 288 148 264

1993 180 323 160 300

1994 227 345 209 329

1995 202 281 174 252

1996 236 275 213 254

1997 256 247 222 214

1998 290 289 251 253

1999 351 343 296 293

2000 464 365 390 290

$200,000 income threshold measured in 1976 constant

dollars (1)

Percentage of all returns with income of $200,000

or more

Returns with no U.S. Returns with no

income tax, by income worldwide income tax,

Tax year concept by income concept

Adjusted Expanded Adjusted Expanded

gross income income gross income income

(13) (14) (15) (16)

1977 0.118 0.127 0.700 0.095

1978 0.126 0.112 0.063 0.062

1979 0.068 0.093 0.027 0.051

1980 0.107 0.099 0.042 0.054

1981 0.104 0.122 0.041 0.077

1982 0.098 0.084 0.045 0.044

1983 0.205 0.144 0.168 0.115

1984 0.210 0.067 0.198 0.057

1985 0.198 0.115 0.143 0.073

1986 0.168 0.099 0.115 0.063

1987 0.193 0.074 0.168 0.050

1988 0.118 0.058 0.107 0.048

1989 0.135 0.056 0.124 0.046

1990 0.156 0.074 0.142 0.060

1991 0.164 0.156 0.149 0.142

1992 0.080 0.127 0.069 0.116

1993 0.089 0.152 0.080 0.141

1994 0.113 0.161 0.104 0.153

1995 0.085 0.113 0.073 0.102

1996 0.085 0.095 0.077 0.088

1997 0.076 0.071 0.066 0.062

1998 0.075 0.073 0.065 0.064

1999 0.082 0.077 0.069 0.066

2000 0.096 0.074 0.081 0.059

(1) 1976 constant dollars were calculated using the U.S. Bureau of

Labor Statistics’ consumer price index for urban consumers. See

footnote 6 of this article for further details.

NOTE: See Figure H for the derivation of U.S. income tax and

worldwide income tax.

Figure E

Returns with No Worldwide Income Tax and with Adjusted Gross Income of

$200,000 or More: Primary Reasons for Reduced Income Tax Liabilities,

Tax Year 2000

Investment interest 34.2%

expense deduction

Medical and dental 8.8%

expense deduction

Net casualty or theft loss 4.5%

deduction

Total miscellaneous 21.1%

deductions

Other 21.8%

Partnership and S 9.6%

corporation net losses

Note: Table made from pie chart.

NOTE: Detail may not add to 100 percent because of rounding.

Figure F

Returns with No Worldwide Income Tax and with Expanded Income of

$200,000 or More: Primary Reasons for Reduced Income Tax Liabilities,

Tax Year 2000

Tax-exempt interest 52.5%

Taxes paid deduction 3.0%

Medical and dental 15.4%

expense deduction

Net casualty or theft loss 4.3%

deduction

Other 12.5%

Partnership and S 8.2%

corporation net losses

Charitable contributions 4.1%

deduction

Note: Table made from pie chart.

NOTE: Detail may not add to 100 percent because of rounding.

Figure G

Derivation of Expanded Income from Adjusted

Gross Income, Tax Years 1977-2000

Adjusted gross income (AGI)

PLUS () Excluded capital gains (tax years prior to 1987)

() Tax-exempt interest (1987 and later tax years)

() Nontaxable Social Security benefits (1987 and

later tax years)

() Tax preferences for Alternative mininum tax

purp[oses [A5]

() Foreign-earned income exclusion (1990 and later

tax years)

MINUS: () Unreimburese employee business expenses [A6]

() Nondeductible rental losses (Tax Year 1987)

() Moving expense deduction (Tax Years 1987 through

1993) [A7]

() Investment interest expense deduction to the extent

it does not exceed investment income

() Misecellaneous itemized deductions not subject to the

2-percent-of-AGI floor (1989 and later tax years)

EQUALS: () Expanded icome

NOTE: Footnotes to Figure G are included with the footnotes to Appendix

A.

Figure H

Derivation of “U.S. Income Tax” and “Worldwide

Income Tax,” Tax Year 2000

Tax at regular rates (tax generated)

PLUS: Additional taxes (such as tax on accumulation

distributions from qualified retirement plans,

Form 4972)

PLUS: Alternative minimum tax (Form 6251)

EQUALS: Income tax before credits

MINUS: Tax credits

EQUALS: U.S. income tax

PLUS: Foreign tax credit

PLUS: Foreign taxes paid on excluded foreign-earned

income (Form 1116)

EQUALS: Worldwide income tax

Notes and References

[1] The statutory requirement is contained in section 2123 of the Tax Reform Act of 1976 (90 Stat. at 1915).

[2] Lerman, Allen H., “High-Income Tax Returns: 1974 and 1975, A Report on High-Income Taxpayers Emphasizing Tax Returns with Little or No Tax Liability,” U.S. Department of Treasury, Office of Tax Analysis, March 1977, and “High-Income Tax Returns: 1975 and 1976, A Report Emphasizing Nontaxable and Nearly Nontaxable Income Tax Returns,” U.S. Department of Treasury, Office of Tax Analysis, August 1978.

Brian Balkovic is an economist with the Individual Returns Analysis Section. This article was prepared under the direction of Terry Nuriddin, Acting Chief.

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