Analysts find poorest get $40 break

The Republican tax law passed last fall will give the richest 1 percent of Americans an average personal income tax break of about $33,000, while the poorest Americans will receive an average personal income tax break of $40, according to a new study published this week by nonpartisan analysts.

The Tax Policy Center, a Washington think tank, has produced its first analysis of how the GOP law’s changes to personal income taxes alone — rather than that of the law overall — affect the rich and poor.

Previous TPC analyses have looked at the overall distributional effects of the law, which included a giant tax cut to corporations and a reduction in the estate tax paid by the wealthiest families. The new TPC report isolates the impact of the law’s personal income taxes, suggesting that the corporate cut does not alone account for the law offering its biggest gains to wealthier Americans.

“While most of the corporate tax cuts flow to the top of the income distribution, what this shows is that even in the direct changes to the individual-side of the tax code, most of those changes are still being allocated to the top,” said Kim Rueben, a senior fellow at TPC.

The biggest winners are the richest 1 percent of Americans, or those earning more

No Wall Street: The U.S. stock markets were closed for the Good Friday holiday.

than $732,800 every year. The smallest bump goes to the poorest income bracket, defined as earning under $25,000 annually.

The size of the break is bigger for those in the middle-income brackets. Those earning between $86,000 and $148,000 annually will get an average break of about $1,500, while those earning between $48,000 and $86,000 will get an average of $780.

Americans earning between $25,000 and $48,000 will get an average personal income tax break of $320, the report says.

A Pew Research Center report from this past fall found that those earning $200,000 or more paid about 59 percent of federal income taxes.

When factoring in all the law’s provisions, including the corporate rate cut, TPC said the richest Americans get a tax break of $51,140, while the poorest Americans receive one of $60.

The law’s personal income provisions will cut taxes for more than 60 percent of residents in all 50 U.S. states and the District of Columbia, according to the TPC analysis.

North Dakota has the most residents coming out ahead — 75 percent of that state’s residents are projected to get a tax cut this year because of the personal income provisions.