Printer Friendly

Notes to Selected and Other Data Tables.

General notations and statements

N/A - Not applicable.

n.a. - Not available.

p - Preliminary.

r - Revised or corrected.

* - Estimate should be used with caution because of the small number of sample returns on which it is based. See "Appendix--SOI Sampling Methodology and Data Limitations."

** - Not shown to avoid disclosure of information about specific taxpayers. However, the data are combined with data in an adjacent size class, as appropriate, and included in the appropriate totals.

Detail may not add to totals because of rounding. All amounts are in current dollars. Percentages shown in some of the tables are based on dollar amounts rounded to the units indicated in the specific table headings. Therefore, they may not be as precise as percentages based on the fuller dollar amounts found in tables contained in the source publications or articles which underlie the historical tables presented in this section of the Bulletin.

In the data sources listed at the end of the footnotes to those tables which cite a Statistics of Income publication or unpublished table as the source, it should be noted that most of the data are subject to sampling error; that tax law and tax form changes affect the year-to-year comparability of the data; and that the specific Statistics of Income reports cited include more complete discussions of sampling error and of other changes affecting comparability of the data over time.

See, also, the appendix to the Bulletin for a general description of "SOI Sampling Methodology and Data Limitations."

Footnotes

Table 1

[1] Year-to-year comparability of the "all returns" total is affected by changes in dollar income filing thresholds, while year-to-year comparability of the number of returns by type of tax form used is affected by changes in the specific filing requirements, including adjustments for inflation, for each form. In general, the filing of "short forms" (mostly Form 1040A; then Form 1040EZ, starting with 1982; and Form 1040-T, for 1995 only) has been encouraged by IRS to simplify both taxpayer filing requirements and IRS processing. Filing requirements for each of the short forms have, therefore, been gradually liberalized to facilitate their use. Increases in the number of short forms by type of form have mostly been at the expense of "long form" 1040 usage (although increases in the number of each of the short forms have often been at the expense of one short form over the other). While the number of 1040 (paper) returns has, therefore, increased over the time period shown, the rate of increase has been reduced by the growing use of the short forms and, later, by the Form 1040PC and electronic filing options (see below). For additional information about the return filing requirements, see the annual reports, Statistics of Income--Individual Income Tax Returns.

Forms 1040, 1040A, and 1040EZ include "standard" electronically-filed ("ELF" or "e-file") returns starting with Tax Year 1985, and Form 1040EZ returns filed electronically by telephone ("TeleFile") starting with 1991. Prior to Tax Year 1994, data for these forms also include computer-generated "paper" returns (Form 1040PC) that were reclassified as Forms 1040, 1040A, or 1040EZ returns for Statistics of Income, depending on the filing characteristics of each return. Because Form 1040PC returns were not reclassified for Statistics of Income after 1993, data for Forms 1040, 1040A, and 1040EZ for these years are not comparable with the preceding years. (However, reclassified data for the more recent years showing percentage distributions of electronically-filed returns by type of tax form may be found elsewhere, in the articles presenting projections of returns to be filed, Winter issues of the Bulletin, starting with the 1993-1994 issue, Volume 13, Number 3.)

Included in the "all returns" total for 1995, but not shown separately, are returns filed on Form 1040-T, a "short form" lending itself to IRS optical scanning, which was used for this one year only, on an experimental basis.

[2] Starting with 1993, taxpayers could elect to assign $3 of the income tax reported on their income tax returns ($6 on a joint return, if both spouses contributed) to help pay for the cost of Presidential election campaigns. To do so, a taxpayer had to check a box on the tax return. Before 1993, this tax offset was limited to $1 (or $2) per return. The relationship between (a) the number of returns and boxes checked and (b) the dollar amounts shown is only approximate because the frequencies and the amounts were obtained from different sources, the frequencies from Statistics of Income tax return data and the dollar amounts from IRS monthly tax collections, aggregated by calendar year. It should be noted that the frequencies and amounts are related to the tax year for which statistics are shown, even though the designation by the taxpayer occurred in the year following, when the income tax return was filed and processed.

[3] Less deficit. Starting with 1987, data are not comparable with earlier years because of major changes in the law, many of which are referred to in other footnotes.

[4] Taxable interest includes "dividends" on deposits and withdrawable shares in mutual savings banks, savings and loan associations, and credit unions, but excludes interest from Regulated Investment Companies on money market mutual funds, which is included in "dividends" in AGI.

[5] Not included in AGI. Represents interest on State and local Government obligations, including tax-exempt interest dividends from Regulated Investment Companies.

[6] Dividends in AGI excludes capital gain and liquidating dividends, reflected in the statistics for net capital gain or loss in AGI, but includes interest from Regulated Investment Companies on money market mutual funds.

[7] Starting with 1987, losses are after "passive loss" limitation.

[8] Starting with 1987, represents total capital gains; previously, represented total capital gains after statutory exclusion. For all years, total includes capital gain distributions from a Regulated Investment Company. Effective during 1997, the definition of capital assets was revised to exclude the primary residence of taxpayers, gain from the sale of which became nontaxable, subject to limitations. For other changes affecting capital gains, see Statistics of Income--Individual Income Tax Returns, various years.

[9] Before 1980 and starting again after 1987, excludes Individual Retirement Arrangement (IRA) distributions; for intervening years, pensions and IRA distributions in AGI were reported together on the tax return. Effective during 1986, the more liberal of the two methods of computing the nontaxable portion of pensions and annuities (representing taxpayer contributions to certain pension plans) was repealed.

[10] Starting with 1987, represents total unemployment compensation; previously, all or part was excludable under certain conditions.

[11] Starting with 1994, up to 85 percent of Social Security benefits were taxable; previously, the maximum was 50 percent.

[12] Excludes sole proprietorship (including farm) rental income or loss. Starting with 1987, rental losses are before "passive loss" limitation and, therefore, exceed the amount included in AGI.

[13] Excludes certain royalties included in computations of capital gain or loss and of ordinary gain or loss, sales of noncapital assets.

[14] Prior to 1981, amounts for net income are actually for net income (less loss). Net income and loss were not separately tabulated. Also, for these years, the number of returns shown with net income was rounded to the nearest hundred thousand during processing; the more exact number was not tabulated.

[15] Includes adjustments not shown separately in this table. Starting with 1987, total excludes certain business-related expenses, deduction for two-earner married couples, and certain alimony payments, but includes the self-employment health insurance deductions (liberalized effective 1998). See also footnotes 16 and 18. Also, for 1987-1993, excludes employee moving expense deduction. Starting with 1990, adjustments include deduction for one-half of self-employment (Social Security) tax, and, starting with 1997, medical savings account deduction. For changes in adjustments for earlier years, see Statistics of Income--Individual Income Tax Returns.

[16] Deductible Individual Retirement Arrangement (IRA) contributions, were limited starting with 1987, then liberalized somewhat starting with 1997 and 1998. Contributions to education and Roth IRA's, new starting with 1998, were nondeductible and are, therefore, not included in the statistics.

[17] Deduction liberalized starting 1999.

[18] Deduction expired during 1994, but was later reinstated retroactively for that year. The deduction was liberalized, starting with 1995, and again, starting with 1998.

[19] Exemption amounts were indexed for inflation, starting with 1985. Amounts were also limited for taxpayers with high incomes, starting with 1991. Statistics include exemptions for age and blindness, repealed effective 1987 and replaced by larger standard deduction amounts (see footnote 20). Starting with 1987, a check box on the return was used for taxpayers age 65 or over, in general, for use in establishing claims for the additional standard deductions, but many taxpayers not claiming the additional deductions also used the checkbox. (A special study for 1993 showed that about 93 percent of all taxpayers age 65 or over, based on Social Security Administration records, checked this box, even though many of them chose to itemize their deductions and, thus, were ineligible for the additional standard deduction for age.)

The amount shown for exemptions excludes those amounts in excess of AGI, which could not be used by the taxpayer. The number of exemptions and amounts also exclude the number and amounts reported on returns with no AGI, which did not figure into the computation of tax, as a result.

[20] In general, represents the sum of standard and itemized deductions from AGI to compute "taxable income," but also includes deductions in excess of AGI that could not be used in the computation. Deductions erroneously reported on returns with no AGI were excluded from the deduction statistics.

For 1980 and 1985 data, includes total itemized deductions before subtraction of "zero bracket amount," plus, for non-itemized deduction returns, the zero bracket amount and, for 1985 data only, a charitable contributions deduction. Starting with 1987, includes revised itemized deductions (see also footnotes 22-23), "basic" standard deduction, and "additional" standard deductions for age 65 or over or for blindness (for changes in the standard deduction and its relation to the zero bracket amount, see Statistics of Income--Individual Income Tax Returns, for appropriate years). Starting with 1991, total itemized deductions are after statutory limitation (see footnote 22).

[21] For 1980 and 1985 data, represents "zero bracket amount" used on returns of non-itemizers. See also footnote 25. Zero bracket amount for 1985 and standard deduction, starting with 1986, were indexed for inflation. Starting with 1987, statistics for taxpayers with the additional standard deduction for age 65 or over exclude those who checked the box on the tax returns indicating age 65 or over, but then itemized their deductions instead of claiming standard deductions (see footnote 19).

[22] Includes itemized deductions not shown separately in this table, including revised deductions, starting with 1987, for "miscellaneous expenses" after limitation and for employee moving expenses. For the most part, moving expenses are excluded after 1993 (see also footnote 15). In general, total itemized deductions were limited for certain high-income taxpayers, starting with 1991. This limitation was indexed for inflation, thereafter. For changes in itemized deductions for earlier years, see Statistics of Income--Individual Income Tax Returns.

[23] Deductible medical and dental expenses were limited, starting with 1987, based on a revised percentage of AGI. The definition of expenses was expanded effective 1997 to include payments for certain long-term care insurance premiums and for the unreimbursed cost of certain long-term care of a chronically ill individual. For changes in the deduction for 1987 and earlier years, see Statistics of Income--Individual Income Tax Returns.

[24] Starting with 1987, State sales taxes were no longer deductible.

[25] Starting with 1987, deductions for "personal" interest and mortgage real estate loan interest were limited and, starting with 1991, personal interest was no longer deductible.

[26] For 1980 and 1985 data, taxable income includes the "zero bracket amount," repealed effective 1987 and partially replaced by standard deductions, which were subtracted in computing taxable income. A standard deduction was similarly used prior to 1980. For the percentages of AGI used for the standard deduction and the limitation on the deduction, see Statistics of Income--Individual Income Tax Returns.

[27] Different tax rate structures for the regular income tax applied to Tax Years 1979-1981, 1982-1986, 1987, 1988-1990, 1991-1992, and 1993-1999. Indexing of tax rate boundaries for inflation was introduced, starting with 1985. The preferential maximum tax rate on net long-term capital gains under "alternative tax" was revised over the years. Alternative tax was abolished effective 1987, but a maximum capital gain tax rate less than the maximum regular tax rate continued to apply under certain conditions, starting with 1991; the maximum rate was further reduced effective 1997. For additional information on changes affecting tax computations, see Statistics of Income--Individual Income Tax Returns.

[28] Includes that portion of the earned income credit used to offset income tax before credits. See also footnotes 35 and 41. Earned income credit is shown below in Table 1.

[29] Includes credits not shown separately, such as the political contributions credit (repealed effective 1987), earned income credit (see below in Table 1; see also footnote 35), low-income housing credit (introduced effective 1987), and child adoption credit (introduced effective 1997). For changes in credits allowed for earlier years, see Statistics of Income--Individual Income Tax Returns.

[30] Credit was liberalized starting 1999.

[31] Investment credit was included in the more inclusive general business tax credit, starting with 1984. With exceptions, investment credit was repealed effective 1986.

[32] Statistics exclude "empowerment zone employment" (EZE) credit, introduced starting 1994.

[33] Includes income tax after credits; additional tax for tax preferences, i.e, "minimum tax"; and "alternative minimum tax" (see footnote 34). It is the amount before any audit and enforcement activities by the Internal Revenue Service and was the amount payable to the U.S. Government as reported on the income tax return.

[34] The add-on "minimum tax" on "tax preferences" (chief among which was net long-term capital gains) was introduced, starting with 1970. (This tax was formerly described in Statistics of Income as the "additional tax for tax preferences.") The "minimum tax" computation, using a base related to taxable income, was revised and the tax rate increased effective 1976. The number of preferences subject to tax was revised effective 1976 and 1981. Starting with 1979, two major preferences formerly subject to "minimum tax" (including the capital gains exclusion described in footnote 8) were subjected, instead, to the new "alternative minimum tax" (AMT), which required taxpayers to pay the larger of the regular income tax or the AMT. Computation of AMT was revised effective 1980 (to allow tax to be reduced by certain credits) then, again, effective 1981 (to modify the graduated tax rate structure), and, again, effective 1987 (to change the starting point for computing "alternative minimum taxable income" from "adjusted gross income" to "taxable income" and to change or eliminate many of the AMT adjustments to and exclusions from tax. The latter included the former capital gains exclusion so that capital gains were no longer considered a tax preference subject to the AMT. Minimum tax was abolished effective 1983, and many of the tax preferences subject to this tax were subjected, instead, to a revised AMT. AMT was increased, starting with 1983, by introduction of a single, higher tax rate, which replaced two, lower graduated rates. The single rate was increased effective 1987 and 1991; two higher graduated rates were introduced effective 1993.

[35] "Earned income credit," allowed certain low-income recipients, was liberalized starting with 1985, 1987, 1991, and 1994, and was further modified starting 1996 and 1998. Indexing for inflation was introduced into the credit computation, starting with 1985. In Table 1, the amounts "used to offset income tax before credits" and "used to offset other taxes" (that are income-related) are reflected in the statistics for "total tax credits"; however, "excess earned income credit (refundable)" is reflected in the statistics for tax "overpayments." The refundable portion of the credit is the amount (in excess of the taxes) that could not be credited, including any "advance earned income credit payments" on those returns that had such an excess. ("Advance earned income credit payments" were made to employees electing to receive such payments currently through their paychecks. Such "payments" are included in the statistics only if the employees also met the tax return filing requirements; advance payments received by those not required to file are, therefore, excluded.)

[36] Total includes the following not shown separately: "advance earned income credit payments" (see footnote 35, above) and credits for (a) capital gains tax paid by a Regulated Investment Company, but considered paid by shareholders, and (b) part of the purchase price of a diesel-powered highway vehicle.

[37] Represents tax withheld on salaries and wages; certain tip income; pensions and annuities; certain gambling winnings; and distributions from profitsharing plans, retirement plans, and Individual Retirement Arrangements (IRA's). Also included are taxes withheld as a result of"backup withholding" on certain interest, dividends, and royalty payments, which otherwise were not subject to withholding.

[38] Represents the sum of (a) "estimated tax," generally paid quarterly throughout the tax year by self-employed and certain other taxpayers with insufficient or no tax withheld, and (b) prior-year tax overpayments taxpayers elect to credit to their current-year's "estimated tax," in lieu of requesting a refund.

[39] Represents the sum of payments made with a request for an "automatic" 4-month extension of time in which to file an income tax return, and payments with a request for an additional 2-month extension. Notwithstanding the timing of these requests, full payment of a tax estimate for the year had to be made with the original application; if adjustments to the amount thus paid were later necessitated, the difference was either refundable or payable subject to an interest charge (which is not reflected in the tax statistics).

[40] Includes income tax, tax recapture of certain prior-year tax credits, tax applicable to Individual Retirement Arrangements (IRA's), Social Security taxes on self-employment income and on certain tip income, and certain other income-related taxes (for the taxes applicable to the years shown, see Statistics of Income--Individual Income Tax Returns).

[41] Includes refunds (shown separately), plus credits to the following year's estimated tax and the refundable portion of the "earned income credit" (see footnote 35). The taxes reflected in tax overpayments are the same as those listed in footnote 40.

SOURCE: Except for dollar amounts associated with the Presidential election campaign checkoff, data are from Statistics of Income--Individual Income Tax Returns, appropriate years. Depending on the year, dollar amounts associated with the Presidential election campaign checkoff were accumulated by calendar year either from U.S. Treasury Department, Internal Revenue Service, "Table S-1 Collections, Comparative Summary, Document 7038," Report NO-Treas-103, monthly, or from unpublished monthly data from Chief Financial Officer, Office of Finance, Revenue Accounting Division, Office of Revenue Systems. See also "General notations and statements," preceding the footnotes section.

Table 2

[1] Includes returns with adjusted gross deficit.

[2] U.S. totals in Table 2 do not agree with Tables 1 and 3 because Table 2 also includes (a) "substitutes for returns," whereby the Internal Revenue Service constructs returns for certain non-filers on the basis of available information and imposes an income tax on the resulting estimate of the tax base, i.e., "taxable income," and (b) returns of nonresident or departing aliens. In addition, for Table 2:

a. "Number of exemptions" also includes responses of taxpayers who checked the boxes on their tax returns for age 65 or over or for blindness, partly to justify the additional standard deductions for age or blindness. Treating these responses as if they were for personal exemptions enables some comparability to be maintained in the State data between years starting with 1987 (the first year for which the additional standard deductions were allowed for age and blindness) and earlier years, when additional personal exemptions were allowed for this purpose, instead. Note, though, that these responses were not included in the 1996 statistics, so data for that year are not altogether comparable with those for 1997-1999 and with years preceding 1996. See, also, Table 1, footnote 19.

b."Itemized deductions" include any amounts reported by the taxpayer, even if they could not be used in computing "taxable income," the base on which the regular income tax was computed. Thus, total itemized deductions include amounts that did not have to be reported by taxpayers with no "adjusted gross income." (Adjusted gross income is the total from which these deductions would normally be subtracted. In addition, if standard and itemized deductions were both reported on a tax return, the form of deduction actually used in computing income tax was the one used for the statistics. Therefore, if the standard deduction was the form of deduction used, the total reported for itemized deductions was excluded from the statistics. However, the component deductions were not similarly excluded. As a result, the number of returns and related amounts for the component deductions are slightly overstated in relation to the grand total shown for itemized deductions. These components are also overstated in relation to the total because there was a statutory limitation on the total of itemized deductions that could be claimed by certain high-income taxpayers. This limitation did not affect the component deductions, the sum of which therefore exceeded the total used in computing income tax. See, also, Table 1, footnote 22.

c. "Income tax" includes the "alternative minimum tax," but differs from "total income tax" in Tables 1 and 3 in that it is after subtraction of all tax credits except the "earned income credit." For additional information, see footnotes 2e and 10 below (for an explanation of the treatment of the earned income credit), and Table 1, footnote 35.

d. "Total tax liability" differs from "income tax," shown above in Table 2, in that it is the sum of income tax after subtraction of all tax credits except the "earned income credit," and, in addition, includes the "alternative minimum tax," taxes from recapture of prior-year investment and low-income housing credits, tax applicable to Individual Retirement Arrangements (IRA's), Social Security taxes on self-employment income and on certain tip income, and certain other income-related taxes. See also footnotes 2e and 10, below, for an explanation of the treatment of the earned income credit.

e. "Earned income credit," limited somewhat starting with 1996, includes both the refundable and non-refundable portions. The non-refundable portion could reduce income tax and certain related taxes to zero; credit amounts in excess of tax, or amounts when there was no tax liability at all, were refundable. See also footnote 10, below.

[3] See footnote 2a, above.

[4] Less deficit.

[5] "Number," here, and elsewhere in Table 2, represents number of returns, unless otherwise specified.

[6] Not included in AGI.

[7] See footnote 2b, above.

[8] Unlike Table 1, "total tax credits" excludes the "earned income credit," shown separately below, in Table 2.

[9] See footnote 2e, above; see also, Table 1, footnote 35.

[10] The refundable portion of the "earned income credit" equals the amount in excess of "total tax liability," which is shown below in Table 2 and defined in footnote 2d. The excess credit shown includes any "advance earned income credit payments" for those returns that had such an excess. See also, footnote 2e, above, and Table 1, footnote 35.

[11] See footnote 2c, above.

[12] See footnote 2d, above.

[13] Reflects payments of the taxes listed in footnote 2d, above.

[14] See Table 1, footnote 35.

[15] Includes, for example, returns filed from Army Post Office and Fleet Post Office addresses by members of the armed forces stationed overseas; returns filed by other U.S. citizens abroad; and returns filed by residents of Puerto Rico with income from sources outside Puerto Rico or with income earned as U.S. Government employees.

[16] Less than $500.

NOTE: This table presents aggregates of all returns filed and processed through the Individual Master File (IMF) system during Calendar Year 2000. In general, during administrative or Master File processing, taxpayer reporting discrepancies are corrected only to the extent necessary to verify the income tax liability reported. Most of the other corrections to the taxpayer records used for these statistics could not be made because of time and resource constraints. The statistics in Table 2 should, therefore, be used with the knowledge that some of the data have not been perfected or edited for statistical purposes and that U.S. totals in this table may not be altogether comparable to U.S. totals in Tables 1 and 3, as a result.

Classification by State was usually based on the taxpayer's home address. However, some taxpayers may have used the address of a tax lawyer or accountant or the address of a place of business; moreover, such addresses could each have been located in a State other than the State in which the taxpayer resided.

NOTE: U.S. totals in this table are not altogether comparable to U.S. totals in Tables 1 and 3, for this reason and also because of the difference in tax return coverage mentioned in footnote 2, above.

SOURCE: Internal Revenue Service, Information Services, Martinsburg Computing Center, Master File Service' Support Branch.

Table 3

[1] In addition to low-income taxpayers, this size class (and others) includes taxpayers with "tax preferences," not reflected in adjusted gross income or taxable income, which are subject to the "alternative minimum tax" (included in "total income tax"), defined in footnote 34, Table 1.

[2] A study for 1993 showed that about half of all returns with adjusted gross income under $5,000 were filed by dependents of other taxpayers.

[3] AGI minus "personal exemptions and total deductions" will not equal "taxable income" because the total of deductions and exemptions could exceed AGI and, therefore, includes amounts that could not be used in computing taxable income.

[4] Tax includes income tax after credits and the alternative minimum tax (see footnote 1).

[5] Not computed.

SOURCE: Statistics of Income--Individual Income Tax Returns, appropriate years. See also "General notations and statements," preceding the footnotes section.

Table 4

[1] Most transfer payments from government and all transfer payments from business are nontaxable. (The taxable portion from government consists primarily of unemployment compensation benefit payments and a portion of Social Security and Railroad Retirement benefit payments.)

[2] Other labor income includes imputations for employer-paid health and life insurance premiums.

[3] Excludes employer-paid health and life insurance premiums and certain interest income, but includes wages in kind, such as employment-related food to employees, including that for the military; standard military clothing issued to military personnel; imputed rental income of owner-occupied nonfarm dwellings (less actual rental income and subsidies); employees' lodging; imputed income of individuals participating in construction of their own housing; and services to individuals furnished without payment by certain financial intermediaries.

[4] Such investment income consists of imputed interest received from life insurance carriers. Also includes investment income of private and Government employee pension plans.

[5] Consists mainly of differences in valuing inventories and in computing depreciation, and of differences in accounting for interest on bonds and for earnings of Individual Retirement Arrangements and of Keogh and other self-employed retirement plans.

[6] Other such personal income consists mainly of voluntary employee contributions to thrift savings plans, tax-exempt interest, tax-exempt military pay and allowances, statutory adjustments to adjusted gross income (AGI) (see Table 1), and an adjustment for treating certain S corp-oration profits as dividends.

[7] Includes pension plan benefit payments, but excludes personal contributions to the plans.

[8] The sum of net capital gains on sales of property held for personal use or investment and of net gains from property sales of a business nature.

[9] Consists of the taxable portion of private and Government employee retirement plan benefit payments.

[10] Consists of income of U.S. citizens living abroad for more than 1 year, supplemental unemployment benefit payments, withdrawals from Individual Retirement Arrangements and Keogh and other self-employed retirement plans, alimony received, State income tax refunds, and gambling and certain other winnings.

[11] Represents income of low-income individuals not required to file individual income tax returns, estimates of unreported and misreported income included in the personal income measure, the net effect of statistical errors or omissions in personal income and adjusted gross income (AGI) measures, and the possible effects of sampling variability on Statistics of Income data.

SOURCE: U.S. Department of Commerce, Bureau of Economic Analysis, Survey of Current Business, Volume 80, Number 2, February 2000 (for revised prior-year data covering 1975-1997) and (Reconciliation of adjusted gross income (AGI) based on revised data for 1998 will be presented in a later issue of the Bulletin.

Tables 5 and 6

[1] See Table 4 for the differences between "personal income" and "adjusted gross income."

[2] Beginning with 1987, data are not comparable with earlier years because of major changes in the definition of adjusted gross income.

[3] Comparisons between SOI and NIPA estimates of AG1 for 1998 are only approximate because the SOI estimate shown was revised after the reconciliation was made. NIPA estimate of AGI for 1998 is based, in part, on the preliminary SOI estimate. Revised NIPA estimate of adjusted gross income (AGI) and comparisons based on it will be included in a later issue of the Bulletin.

SOURCE: Data on "personal income (per NIPA)" are from U.S. Department of Commerce, Bureau of Economic Analysis. For 1950-1958 revised data, Survey of Current Business, Volume 80, Number 4, April 2000. For 1959-1997 revised data and for 1998-2000, Survey of Current Business, various issues. For data on "adjusted gross income (per SOI)" in Table 6, see Statistics of Income--Individual Income Tax Returns, various years. See also "General notations and statements," preceding the footnotes section.

Table 7

[1] Sum of standard and itemized deductions, plus charitable contributions deduction reported on standard deduction returns for Tax Years 1982-1986. Deductions exclude amounts shown as "statutory adjustments" in Table 1. For Tax Years 1987-1988, total deductions also include "zero bracket amount" reported on a small number of returns (see footnote 4). Includes total deductions as reported by taxpayers, even if the total exceeded AGI and, therefore, could not be used.

[2] See footnote 2, Tables 5 and 6.

[3] Series revised, starting with the Spring 1997 Bulletin, to exclude the relatively small number of returns with no adjusted gross income and no deductions from the standard deduction statistics; previously, these returns were classified as if they showed a standard deduction. For the 1977-1986 statistics, the standard deduction is the "zero bracket amount" (reported on returns with only a "zero bracket amount"). Such an amount was also included for a small number of returns for 1987-1988; see footnote 4. For years in which the "zero bracket amount" was in effect, frequencies shown for standard deduction returns were derived by subtracting the number reporting an income tax liability, but no itemized deductions, from the total of all returns. For 1950-1952, returns with itemized deductions include the small number of returns with no deductions and, for 1950-1954, the small number with no adjusted gross income, regardless of whether or not deductions were itemized. In later years, returns in these two categories were excluded from all the deduction statistics in this table.

[4] Amount of standard deduction for 1950-1957 was estimated by Joseph A. Pechman, The Brookings Institution, on the basis of the distribution of the number of returns by income class and marital status in Statistics of Income--Individual Income Tax Returns, and, starting with 1958, was obtained directly from Statistics of Income tabulations for these years. Represents "zero bracket amount" for 1977-1986. Starting with 1987, represents the sum of"basic" and "additional" standard deductions (for age 65 or over and for blindness); also includes zero bracket amount reported on the small number of prior year returns filed in 1988-1989 that was included in the 1987-1988 statistics.

[5] For 1977-1986, total itemized deductions are before subtraction of the "zero bracket amount." Starting with 1991, total itemized deductions are after statutory limitation (see footnote 22, Table 1).

SOURCE: Except as indicated in footnote 4, Statistics of Income--Individual Income Tax Returns and unpublished tables, appropriate years. Data referred to in footnote 4 which are attributed to Joseph A. Pechman are from Pechman, Federal Tax Policy, Fifth Edition, The Brookings Institution, 1987. See, also, "General notations and statements," preceding the footnotes section.

Table 8

[1] See Table 4 for the differences between "personal income (per NIPA)" and "adjusted gross income."

[2] Excludes the "zero bracket amount" for 1977-1986; therefore, Table 8 differs from Table 1. Because of major changes in law, "taxable income" starting with 1955 and 1987 is not comparable with earlier years. See also footnote 26, Table 1.

[3] Note that the "taxable income" base excludes the base for computing both the "minimum tax" and "alternative minimum tax" components of "total income tax." Therefore, the percentages shown in column 6 starting with 1970 are only approximate. See also footnote 33, Table 1.

[4] Comparisons between personal income and SOI data for taxable income and tax for 1998 are only approximate because the SOI estimates were revised after the reconciliation was made. Personal income for 1998 was based, in part, on preliminary SOI adjusted gross income (AGI) data. Revised personal income estimate and comparisons based on it will be included in a later issue of the Bulletin.

SOURCE: Data on "personal income (per NIPA)" are from U.S. Department of Commerce, Bureau of Economic Analysis. For 1950-1958 revised data, Survey of Current Business, Volume 80, various issues. For 1959-1997 revised data and for 1998-2000, Survey of Current Business, Volume 80, Number 2, February 2000. For data on "taxable income (per SOI)" and "total income tax (per SOI)," see Statistics of Income--Individual Income Tax Returns, various years. See also "General notations and statements," preceding the footnotes section.

Table 9

[1] Starting with 1975, includes the refundable portion of the "earned income credit."

SOURCE: Statistics of Income--Individual Income Tax Returns and unpublished tables, appropriate years. See, also, "General notations and statements," preceding the footnotes section.

Table 10

[1] For 1980, represents number of businesses (up to a maximum of three per return). For other years, represents only the number of returns, even if there was more than one business per return.

[2] "Total deductions" include amounts not shown separately in this table, as well as amounts not itemized separately on Schedule C-EZ (short form) used by certain of the smaller businesses, starting with 1992. Most deductions for which statistics are shown are slightly understated to the extent that only total deductions had to be reported on Schedule C-EZ. After 1986, total deductions exclude disallowed "passive losses"; but net income (less deficit), net income, and deficit reflect these losses. In addition, net income (less deficit), net income, and deficit are after adjustment for the passive loss carryover from prior years. Therefore, "business receipts" minus "total deductions" does not equal "net income (less deficit)."

NOTE: There are slight differences between: (a) the number of individual income tax returns "with business or profession net income or loss" and the associated amounts based on the summarized totals on the face of the tax return (Table 1), and (b) the related number of individual income tax returns "with nonfarm business net income or deficit" and the associated amounts based on data from Schedules C filed in support of the total on the face of the return (Table 10). These differences result from the somewhat larger tax return samples underlying the sole proprietorship statistics for more recent years, and also from taxpayer reporting variations and inconsistencies, e.g., in the occasional misreporting of farm versus nonfarm business activity on the face of the return compared to what was indicated in supporting schedules, and in the equating of certain partnership income or employee business expenses with the presence of sole proprietorship activity.

SOURCE: Statistics of Income--Sole Proprietorship Returns, appropriate years, and Statistics of Income Bulletin, Summer issues (for most years). See also, "General notations and statements," preceding the footnotes section.

Table 11

[1] After 1990, certain small partnerships were not required to file balance sheets.

[2] Number of limited partnerships and of limited liability companies and associated number of partners is understated because some businesses failed to answer the question about type of partnerships on their tax returns as originally filed. Also, the question identifying partnerships as limited liability companies was only introduced starting with 1993 returns. No attempt was made to identify these companies for the statistics for earlier years.

[3] Total assets, total liabilities, and partners' capital account represent end-of-year amounts. Moreover, they are understated somewhat because not all partnerships included a complete balance sheet and, for the later years, because of the change in the reporting requirement mentioned in footnote 1, above.

[4] Short-term debt is the abbreviated title for mortgages, notes, and bonds payable in less than 1 year.

[5] Long-term debt is the abbreviated title for mortgages, notes, and bonds payable in 1 year or more.

[6] "Total receipts" and "total deductions" include amounts not shown separately. Prior to 1981, "total receipts" included gross income from farming, rents, and royalties. Expenses related to this income were included under "total deductions." Starting with 1981, only the net incomes or deficits from farming, rents, and royalties were tabulated; the positive amounts were included under "total receipts" and the negative amounts under "total deductions." The related expenses were not tabulated. Because of a redesign of the partnership return, starting with 1987, total receipts were computed for the statistics as the sum of "total income from a trade or business"; and the following income distributed directly to partners: "ordinary" gain from sales of property other than "capital assets"; "ordinary" income from estates, trusts, and other partnerships; "portfolio income," comprising interest, dividends, royalties, and other (excluding net capital gains, see below); and rental real estate income (positive amounts only); and income from other rental activities (positive amounts only). Most, but not all, of these types of income were included in receipt data for 1986 and earlier years. See also footnote 9, below.

Total deductions were computed as the sum of "cost of sales and operations," "total deductions from a trade or business," and the following, which were allocated directly to partners: "ordinary" loss from sales of property other than "capital assets"; "ordinary" loss from estates, trusts, and other partnerships; rental real estate losses; other rental losses; and "portfolio losses" (excluding net capital losses).

Portfolio income or loss from sales of "capital assets" was intentionally omitted from receipt and deduction statistics to improve comparability with earlier years. Therefore, the statistics in Table 11 will not agree with statistics in articles on partnerships that appear in prior issues of the Bulletin. See also footnote 9 below.

[7] "Business receipts," starting with 1981, are not comparable to 1980. Prior to 1981, when partnerships classified in finance, insurance, and real estate reported gross rentals as their principal operating income, such rentals were transferred to "business receipts" for the statistics. No such transfers were made after 1980, so that, starting with 1981, all rentals were included in the separate statistics for rental income (which is not shown in Table 11).

[8] Taxable interest only. For the 1985 statistics, also includes certain dividends reported in combination with taxable interest.

[9] Before 1990, represents the "cost of sales and operations," the sum of "cost of goods sold" (where inventories were an income-determining factor, as in the case of manufacturers or retailers) and the "cost of operations" (where inventories were not an income-determining factor, as in the case of certain utilities and services). These two components had been separately reported on the tax return. After the cost of operations no longer had to be reported as such on the return, the component expenditures were includable in the individual deductions for which separate statistics are shown. For this reason, starting with 1990, statistics shown as representing the cost of goods sold and the various other deductions are not strictly comparable with earlier years.

Also, before 1983, small, identifiable amounts of depreciation, depletion, amortization, employee benefit program contributions, and certain other expenses, when identified in schedules in support of the cost of goods sold/cost of operations, were transferred to their respective deduction headings in order to provide more complete statistics on these expenditures. These adjustments were discontinued starting with the 1983 statistics. Therefore, for the more recent years, the statistics for the various expenditures represent only the amounts not included in the cost of goods sold/cost of operations. As a result, the statistics for these expenditures are slightly understated. Correspondingly, those for the total cost of goods sold/cost of operations are more all-inclusive in the statistics, as reported by the partnership.

[10] After 1980, represents the more complete amounts reported in depreciation computation schedules, rather than the amounts reported as the depreciation deduction (augmented by depreciation identified for the statistics in cost of sales and operations schedules for years before 1983).

SOURCE: Statistics of Income--Partnership Returns, appropriate years, and Statistics of Income Bulletin, Summer or Fall issues (for most years). See also "General notations and statements," preceding the footnotes section.

Table 12

[1] Size classes are based on "business receipts," i.e., gross amounts from sales and operations, for industries except those in finance, insurance, and real estate. For the latter industries, "total receipts," which are the sum of business receipts and investment income, were used. For partnerships, comparability of data by size of receipts is affected by revisions to the definition of receipts. See also footnotes 6 and 7, Table 11. To help minimize the break in comparability caused by the change in statistical treatment of partnership farm and rental income, an effort was made for 1981-1987 only to include rental (though not farm) gross income in the receipts used for the size distribution in Table 12. Starting with 1988 though, only partnership net rentals are reflected in the size distribution.

[2] Includes returns with no business receipts.

[3] Includes corporations and partnerships with "zero assets and liabilities." For corporations, returns with zero assets represent final returns of liquidating or dissolving corporations which had disposed of all assets; final returns of merging corporations whose assets were included in the returns of the acquiring corporations; part-year returns of corporations changing accounting periods (except for certain newly-incorporated businesses); and returns of foreign corporations with income "effectively connected" with a U.S. business (except foreign insurance companies providing separate balance sheets for U.S. branches). For partnerships, returns with zero assets include businesses not required to file balance sheets, as well as businesses that failed to provide balance sheets on their returns as originally filed (see also footnote 1, Table 11). (Sole proprietors were not required to provide balance sheet information.)

[4] For 1980, the size distribution shows the number of businesses, rather than the number of returns. See footnote 1, Table 10. Therefore, the total for 1980 differs from that presented in Table 10.

SOURCE: Statistics of Income--Corporation Income Tax Returns; Statistics of Income--Partnership Returns, Sole Proprietorship Returns, and Business Income Tax Returns, depending on the year; and Statistics of Income Bulletin, Summer or Fall issues (for most years). See, also, "General notations and statements," preceding the footnotes section.

Table 13

[1] Starting with 1985, "number of returns" excludes taxable farmers' cooperatives; starting with 1987, Real Estate Mortgage Investment Conduits (REMIC's); and, starting with 1988, Foreign Sales Corporations (FSC's) and Interest-Charge Domestic International Sales Corporations (IC-DISC's). See also footnotes 5 and 6, below. "Number of returns" also excludes Personal Service Corporations for 1988-1993. Because of the omission of these categories of returns, totals for all income, financial, and tax items shown in the statistics (except those not applicable to IC-DISC's and FSC's, such as "income subject to tax," "income tax," and tax credits) are slightly understated. (There were 980 IC-DISC returns for 1991 (see Holik, Daniel S., "Interest-Charge Domestic International Sales Corporations, 1991," Statistics of Income Bulletin, Summer 1995, Volume 15, Number 1); and 773 for 1996 (see Belmonte, Cynthia, "Interest-Charge Domestic International Sales Corporations, 1996," Statistics of Income Bulletin, Fall 2000, Volume 20, Number 2); 3,073 FSC returns for 1992 (see Holik, Daniel S., "Foreign Sales Corporations, 1992," Statistics of Income Bulletin, Summer 1997, Volume 17, Number 1); and 4,363 FSC returns for 1996 (see Belmonte, Cynthia, "Foreign Sales Corporations, 1996," Statistics of Income Bulletin, Spring 2000, Volume 19, Number 4).

A change in the definition of S corporation net income, starting with 1987, means that totals for receipts and deductions are slightly understated to the extent that they were not directly related to the "income from a trade or business" reported by these companies. Comparability of data for "returns with net income" is also affected by this change, as well as by a change in the Statistics of Income definition of Regulated Investment Company net income for certain years. For additional information about these changes and the estimated effect they have on the net income statistics, see footnote 18, below.

[2] Consolidated returns were filed on an elective basis for groups of affiliated corporations (with exceptions), in general, if 80 percent or more of the stock of the affiliates was owned within the group, and a common parent corporation owned at least 80 percent of the stock of at least one of the affiliates.

[3] Included in "number of returns, total" and "number with net income."

[4] In general, certain small qualifying corporations that elected to be taxed at the shareholder level. These corporations could have no more than 75 shareholders (mostly individuals) starting with Tax Year 1997; no more than 35 for Tax Years 1983-1996 (no more than 25 for 1982, and no more than 15 for 1979-1981). The types of "persons" who could be shareholders was liberalized starting with 1997.

[5] Domestic International Sales Corporations (DISC's) were designed to promote U.S. exports. They were taxed through parent corporations, but only when profits were distributed or deemed distributed to them. This system of tax deferral was generally replaced after 1984 with a new system of Foreign Sales Corporations (FSC's). See footnote 6. Tax benefits of DISC's remaining after 1984 were limited, and an interest charge for tax-deferred amounts was imposed on the parent shareholders whose DISC subsidiaries were unable to meet the FSC requirements and that elected to continue, instead, as IC-DISC's.

[6] Foreign Sales Corporations (FSC's) generally replaced Domestic International Sales Corporations (DISC's) as a means of promoting U.S. exports (see footnote 5). Under the FSC provisions, a portion of these subsidiaries' "foreign trade income" was exempt from U.S. income tax.

[7] Balance sheet data are end-of-year amounts.

[8] Starting with 1985, inventories include amounts reported by real estate subdividers and developers previously included in "other investments."

[9] For the 1980 historical statistics, tax-exempt securities represent investments in State and local Government obligations. For the 1985 statistics, these securities were reportable with investments in U.S. Government obligations as a combined total on the tax return, so that for this year, the data described as for U.S. Government obligations include State and local Government obligations, as well. After 1988, tax-exempt securities were again reported separately on the tax return, but were redefined to include, not only investments in State and local Government obligations, but also stock in investment companies that distributed dividends during the current year representing tax-exempt interest on such obligations. Formerly, such stock was reportable in "other investments."

[10] After 1990, accounts payable of banking and savings and loan institutions include deposits and withdrawable shares previously reported in "other current liabilities."

[11] Starting with 1997, includes "adjustments to shareholders' equity," not previously reported separately on the tax return.

[12] In general, after 1982, Statistics of Income data for receipts, deductions, and net income (or deficit) of S corporations are limited to those attributable to a trade or business. Therefore, most investment income or loss, such as from taxable interest, dividends, rents, royalties, and gain (loss) from sales of investment property; the deductions related to this income; and deductions for charitable contributions, intangible drilling and development costs, oil and gas depletion, foreign taxes paid, and the limited expensing of the cost of depreciable assets (Code section 179), are not reflected in net income (because they were allocated directly to shareholders, instead). See also footnote 4.

Prior to 1992, statistics for the "cost of goods sold" represent the more inclusive "cost of sales and operations." Cost of goods sold applies when inventories are an income-determining factor, i.e., when the corporation was engaged in the production, manufacture, purchase, or sale of merchandise in the course of its trade or business. Cost of operations applies whenever inventories are not an income-determining factor, as in the case of certain utilities and services (see below). The statistics for the cost of goods sold after 1991, therefore, also exclude estimates of the cost of operations previously constructed for the statistics from expense data reported elsewhere on the tax return (often in "other deductions") by corporations reporting "business receipts" without a corresponding cost of goods sold. These corporations were assumed to have a cost of operations that was not reported as such. Most of the companies involved were classified either in the "transportation and public utilities" or "services" industrial divisions.

For all years, identifiable amounts of depreciation, depletion, amortization, taxes paid, advertising, bad debts, compensation of officers, employee plan contributions, interest paid, and rent found in taxpayer schedules in support of the total cost of goods sold/cost of operations were transferred to their respective deduction headings for the statistics. This enabled more complete statistics for these expenditures to be produced.

[13] After 1986, "business receipts" include the full amount reported by stock and commodity brokers and exchanges, and by real estate subdividers, developers, and operative builders, even when they bought and sold securities, commodities, and real estate on their own account. Previously, such transactions were treated as "net gain (loss), noncapital assets."

[14] Starting with the 1985 statistics, "other interest" includes any dividends reported in combination with interest on Form 1120S by S corporations, i.e., certain corporations that elect to be taxed through shareholders (see footnote 4). Based on prior years when Form 1120S required each to be reported separately, nearly all of the combined amount represents interest.

[15] For the 1985 statistics, "other deductions" include depletion and employer contributions to pension, profit-sharing, stock bonus, and annuity plans, and to employee benefit programs, reported on the Form 1120-A short form. After 1987, identifiable amounts reported on Form 1120-A for any of these items are included in the statistics for the appropriate deduction. Starting with 1992, "other deductions" include certain amounts previously treated as part of the combined "cost of goods sold/cost of operations" for Statistics of Income. See also footnote 12.

[16] In general, "total receipts less total deductions" include tax-exempt interest on State and local Government obligations, but exclude income from related foreign corporations only "constructively" received. As such, "total receipts less total deductions" represent all income, taxable and nontaxable, "actually" received by the corporation, as reported on the corporation income tax return, and exclude all income only "constructively" received. In contrast, "net income (less deficit)" represents all taxable income, actually or constructively received. Therefore, in the statistics, "total receipts less total deductions" minus "nontaxable interest on State and local Government obligations" plus "constructive taxable income from related foreign corporations" equal "net income (less deficit)." For the exception, due to Regulated Investment Companies, see footnote 18.

[17] Represents "income" that was deemed (but not actually) received from foreign corporations and taxed currently to the U. S. corporation. (In general, such income was otherwise subject to U. S. income tax only when actually repatriated as a dividend.) It was the sum of includable income of Controlled Foreign Corporations and also the "foreign dividend gross-up." The "includable income" consisted of specific types of undistributed income earned by a Controlled Foreign Corporation that were taxed under certain conditions to the U. S. shareholder corporation unless an actual "minimum distribution" was made. The foreign dividend gross-up represented a share of the foreign taxes paid on the profits of certain foreign subsidiaries from the paid dividends to their U. S. parent corporation and for which the parent corporation claimed a foreign tax credit.

[18] "Net income (less deficit)," "net income," and "deficit" shown for 1990-1997 exclude: (a) net long-term capital gain reduced by net short-term capital loss reported by Regulated Investment Companies (see also footnote 16), and (b) amounts other than "from a trade or business" reported by S corporations (see also footnote 4). For comparisons with earlier years, these amounts should, therefore, be added back. Regulated Investment Company net long-term capital gain (reduced by net short-term capital loss) was excluded from the net income in Table 13 statistics, starting with 1990. With respect to Table 13, the amounts excluded were: $7.5 billion for 1990; $57.2 billion for 1995; $92.5 billion for 1996; $164.1 billion for 1997; and $192.6 billion for 1998. S corporation net income (less deficit) excluded from the statistics were estimated at $99.2 billion for 1995; $127.4 billion for 1996; $155.9 billion for 1997; and $193.2 billion for 1998. Data with which to estimate S corporation net income (less deficit) excluded from the statistics for 1990 were not tabulated. For additional information about S corporation net income, see Statistics of Income Bulletin, Wittman, Susan "S Corporations, 1995," Spring 1998, Volume 17, Number 4; Wittman, Susan and Grant, Robert "S Corporation Returns, 1996," Spring 1999, Volume 18, Number 4; Wittman, Susan "S Corporation Returns, 1997," Spring 2000, Volume 19, Number 4, and "S Corporation Returns, 1998," Spring 2001, Volume 20, Number 4.

[19] For most years, "income subject to tax" (the corporate tax base) exceeds "net income (less deficit)" in the statistics, chiefly because of the deficits reported on returns without net income. Moreover, it is the sum of the several tax bases applicable over time to different classes of corporations, not all of which were directly related to net income. Income subject to tax thus includes the "taxable income" base used by most companies (and defined for the statistics as net income minus certain statutory special non-business deductions, such as for intercorporate dividends received and "net operating losses" carried forward from prior years); before 1988, a variation of this base in combination with net long-term capital gains in certain situations where the lower capital gains tax applied; and the special tax bases applicable to S corporations (otherwise taxed through their shareholders), insurance businesses, and certain investment companies. Profits of Domestic International Sales Corporations or Interest-Charge Domestic International Sales Corporations (depending on the year) were tax deferred until distributed (actually or constructively) to parent businesses, and those of S corporations were mostly taxed through shareholders (who had to be individuals, estates, or trusts). Profits of Foreign Sales Corporations were included in the corporation income tax return statistics for 1985-1987 only, but the taxable portion for these years was excluded from income subject to tax. Therefore, the statistics for (positive) net income for these several types of corporations are not reflected in the statistics for income subject tax.

[20] For 1980, includes tax from recapture of Work Incentive Program (WIN) credit; starting with 1985, Personal Holding Company tax; after 1987, tax on "branch profits" of foreign corporations with U.S. operations; and, after 1988, certain lesser taxes, including special taxes applicable to Real Estate Investment Trusts (REIT's) and foreign corporations with U.S.-source income. Starting with the statistics shown for 1990, total income tax includes an environmental excise tax reported on the corporation income tax return and collected as part of the corporation income tax. This tax was repealed effective during 1996. "Total income tax" more closely represents worldwide income tax liability because it is before subtraction of the foreign tax credit, the largest of the tax credits. To the extent that foreign tax credits adequately reflect the total foreign income tax burden, total income tax includes these taxes. See also footnotes 23 and 25.

[21] Different tax rate structures applied for Tax Years 1980-1981, 1982, 1983-1986, 1987-1992, and 1993-1998. In general, starting with tax years beginning in 1987, "alternative tax" was repealed. This tax included a preferential rate for long-term capital gains (as did the somewhat similar, separate tax on long-term capital gains that certain investment companies and insurance businesses were allowed in lieu of alternative tax).

[22] Effective during 1987, the "alternative minimum tax" replaced the "minimum tax" (formerly referred to in the statistics as the "additional tax for tax preferences"). Therefore, the "number of returns" shown represents the number with the minimum tax for years before 1990 and the number with alternative minimum tax for later years. The tax computation was modified effective with Tax Years 1983, 1984, and 1990. The alternative minimum tax rate exceeded that applicable under the former minimum tax.

[23] Tax credits are applied against "regular and alternative tax" only. See also footnote 24.

[24] Data on foreign tax credit for 1980, 1990, 1995, and 1996, and on U.S. possessions credit for 1980 and 1995, are revised based on results of special studies. For additional information, see "Source," below.

[25] Starting with the statistics for Tax Year 1985, the general business credit includes the following components, all of which were subject to a combined overall limitation: the alcohol fuel credit, and the investment credit (the sum of current-year credits for rehabilitation, energy, and reforestation expenses), plus the jobs credit (renamed "work opportunity credit," in 1996), the employee stock option plan (ESOP) credit (included for 1985 and 1986 only), and the orphan drug credit (starting with 1996). Each of these components was reported independently of the general business credit, with its own limitation, for years before 1985). In addition, the general business credit includes the following other credits beginning with 1985 or a subsequent year: for increased research expenditures and low-income housing (starting 1986); for certain costs attributable to making a business accessible to disabled individuals ("disabled access" credit) (starting 1990); for certain enhanced domestic oil recovery expenditures (starting 1991); for the cost of electricity produced from renewable sources (starting 1992); for certain costs of American Indian employment, for certain contributions to qualified Community Development Corporations, for a portion of employer-paid Social Security and Medicare taxes on certain employee cash tips (each starting 1993); and for "empowerment zone employment" (the so-called "EZE credit") (starting 1994, also see below); for amounts transferred to the Trans-Alaska Pipeline Liability Fund (starting 1995); and for wages paid to employees who were recipients of long-term family assistance ("welfare-to-work") programs (starting 1998). In addition, the general business credit includes unused amounts carried forward from earlier years from the otherwise expired work incentive (WIN), ESOP, investment, and former jobs credits. By law, the EZE credit was part of the general business credit, but because it was subject to a separate limitation and was, therefore, computed separately, it is not included in the statistics for the general business credit. For changes in the definition of components of the general business credit, see Statistics of Income--Corporation Income Tax Returns, for the years concerned.

[26] Total income tax after credits is before any audits or enforcement activities by the Internal Revenue Service. It is the amount payable to the U.S. Government as reported on the income tax return, and, because it is after subtraction of foreign tax credit, the total does not include income taxes paid to foreign governments. Amounts shown for 1980, 1990, 1995, and 1996 have been revised because of revisions to the foreign tax credit (for both years) and the U.S. possessions credit (for 1980 and 1995). See also footnote 24 and "Source," below.

SOURCE: Statistics of Income--Corporation Income Tax Returns, except for the revised data shown for the foreign tax credit for 1980, 1990, and 1995, and the U.S. possessions credit for 1980 and 1995. Based on these revisions, data for "total income tax after credits" have also been revised for these years. The revised credit data are from special in-depth studies of the tax return computation schedules in support of the credits claimed and include the results of taxpayer followup for additional information. The results of these studies, including those for other years besides those shown in Table 13, are summarized in articles included in various issues of the Statistics of Income Bulletin. See, also, "General notations and statements," preceding the footnotes section.

Tables 14a (14) and 14b (14a)

[1] Industrial classification is based on the product or service accounting for the largest percentage of "total receipts" (total receipts is the sum of business or gross receipts, plus capital gains and income from investments, including rentals). Starting with 1998, this classification is based on the North American Industry Classification System (NAICS), which replaced the Standard Industrial Classification (SIC) system. The SIC, in its various versions, was used to classify the statistics for the years before 1998. Both systems were intended for Government-wide use in classifying business statistics. (For information about NAICS and its usage in Canadian, Mexican, and U.S. Government statistics, see Statistics of Income Bulletin, Summer 1997, pp. 3-5, Volume 17, Number 1. Because there are substantial differences between NAICS and its predecessor SIC system, data by "industrial sector" for years beginning with 1998 (Table 14b) are shown apart from the data for the earlier years by "industrial division" (Table 14a). As an example of the differences between the two systems, using NAICS, Statistics of Income classifies banks that were bank holding companies under the new "Management of companies (holding companies)" sector, instead of the "Finance and insurance" sector. Using the SIC, bank holding companies had previously been classified in the "Finance, insurance, and real estate" "industrial division." For additional information about the breaks in comparability caused by the changeover to NAICS, see Statistics of Income--1998, Corporation Income Tax Returns.

If information for the business activity and product were not discernible from the corporation income tax return, the return was classified as with "Nature of business not allocable." Data for "Nature of business not allocable" are included in the totals for "All industrial divisions" (Table 14a) and "All industrial sectors" (Table 14b), but are not shown separately. Therefore, in addition to rounding differences, the statistics by industrial division or sector will not add to their respective totals.

[2] See footnote 1, Table 13.

[3] Net worth is the sum of "capital stock," "paid-in or capital surplus," "retained earnings, appropriated," and "retained earnings, unappropriated" minus "cost of treasury stock." (Data for "retained earnings, unappropriated" include "adjustments to shareholders' equity," not reported separately on the tax return prior to 1997.) Each of these amounts is presented separately in Table 13.

[4] See footnotes 12 and 16, Table 13.

[5] See footnote 13, Table 13.

[6] Interest received is the sum of "interest on State and local Government obligations" (i.e., tax-exempt interest) and "other interest" (which includes interest paid by banking and savings institutions). Data for both of these amounts are presented separately in Table 13. See also footnote 14, Table 13.

[7] In addition to regular (and alternative) tax for years prior to 1988, includes certain other taxes either shown separately in Table 13 or mentioned in footnote 20, Table 13.

[8] See also footnote 21, Table 13.

SOURCE: Statistics of Income--Corporation Income Tax Returns, appropriate years, except for revised data for "total income tax after credits" for 1980, 1990, 1995, and 1996, which are based on indepth special studies of the foreign tax credit or U.S. possessions credit published in the Statistics of Income Bulletin, various issues. See "Source" for Table 13 for additional information. See also "General notations and statements," preceding the footnotes section.

Table 15

[1] Profits shown are without the inventory valuation and capital consumption adjustments made by the Bureau of Economic Analysis. They also exclude the profits of S corporations, which are treated as "personal income" in the National Income and Product Accounts (see Table 4).

[2] "Net income (less deficit)" and "income subject to tax" exclude taxable cooperatives, starting with the 1985 data, Real Estate Mortgage Investment

Conduits (REMIC's), starting with 1987, and Personal Service Corporations for 1988-1993. Net income (less deficit), starting with 1985, excludes Foreign Sales Corporations (FSC's) and Interest-Charge Domestic International Sales Corporations (IC-DISC's). See also footnote 1, Table 13. For changes in the definition of Regulated Investment Company and S corporation net income, see footnote 16, Table 13.

[3] For the definition of "income subject to tax," see footnote 19, Table 13. See also footnote 2, above.

SOURCE: Corporate "profits before taxes (per NIPA)" are from U.S. Department of Commerce, Bureau of Economic Analysis, Survey of Current Business, Volume 80, Number 2, February 2000. For 1960-1995, data are revised (1999). For years starting with 1996, see Survey of Current Business, various issues. For "net income (less deficit) (per SOI)" and "income subject to tax (per SOI)," see Statistics of Income--Corporation Income Tax Returns, various years. See also "General notations and statements," preceding the footnotes section.

Table 16 (New)

[1] Includes data reported by organizations described in Internal Revenue Code section 501(c)(3), excluding private foundations and most religious organizations. Organizations with receipts under $25,000 were not required to file.

[2] Nonoperating foundations generally carried on their charitable activities in an indirect manner by making grants to other organizations directly engaged in charitable activities. However, some nonoperating foundations were actively involved in charitable programs of their own, in addition to making grants.

[3] Operating foundations generally expended their incomes for direct, active involvement in a tax-exempt activity, such as operating a library or museum or conducting scientific research.

[4] Includes data reported by organizations described in Internal Revenue Code sections 401(a), 408(e), and 501(c)(2) through 501(c)(25).

[5] Excludes cost of sales and services, which was subtracted form gross receipts from sales and services in computing gross profit from sales and services (GPSS). GPSS is a component of gross unrelated business income (upon which the filing requirement is based).

[6] Total tax was unrelated business income tax less the foreign tax credit, general business credit, credit for prior-year minimum tax, and other allowable credits, plus the "proxy tax" on certain lobbying expenditures (applicable only to tax years after 1993), tax from recomputing certain prior-year credits, the "alternative minimum tax," and the environmental tax (applicable only to tax years prior to 1996).

Table 17 (16)

[1] Total adult deaths represent those of individuals age 20 and over, plus deaths for which age was unavailable.

[2] Prior to 1964, a return was taxable if it showed an estate tax before credits; starting with 1964, the classification was based on estate tax after credits. Prior to 1982, number of "taxable estate tax returns" by year of death is only approximate because, while the majority of returns filed in a given calendar year represent estates of decedents who died in the immediately preceding year, many represent estates of decedents who died in earlier years. Therefore, the number of taxable returns shown for 1976 decedents, for example, is actually the number of taxable returns filed in 1977, regardless of year of death. Starting with 1982, statistics by year of death are more accurate because they are based on the year of death reported on return filings over a period of successive years.

Year-to-year comparability of the data is affected by changes in the gross estate filing threshold, which is based on year of death: 1934 ($50,000); 1935 through 1941 ($50,000 changing to $60,000); 1942 ($40,000 changing to $60,000); 1943 through 1976 ($60,000); 1977 ($120,000); 1978 ($134,000); 1979 ($147,000); 1980 ($161,000); 1981 ($175,000); 1982 ($225,000); 1983 ($275,000); 1984 ($325,000); 1985 ($400,000); 1986 ($500,000); and 1987 through 1997 ($600,000); 1998 ($625,000); 1999 ($650,000); 2000-2001 ($675,000); 2002-2003 ($700,000); 2004 ($850,000); 2005 ($950,000); and 2006 and thereafter ($1,000,000).

SOURCE: For years after 1953, Statistics of Income--Estate Tax Returns; Estate and Gift Tax Returns; or Fiduciary, Estate and Gift Tax Returns, depending on the year, and Statistics of Income Bulletin, various issues; also unpublished tabulations for certain years. Data are shown only for years for which Statistics of Income data are available. For years prior to 1954, Statistics of Income--Part I. Adult deaths are from the Centers for Disease Control and Prevention, National Center for Health Statistics, U.S. Department of Health and Human Services, Vital Statistics of the United States, Report Number 11, Supplement 2, Table 2, annual. See also "General notations and statements," preceding the footnotes section.

Table 18 (17)

[1] Includes not only taxes collected by the Internal Revenue Service (IRS) but, starting in Fiscal Year 1988 and the second quarter of Fiscal Year 1991, excise taxes collected by the Bureau of Alcohol, Tobacco and Firearms and the Customs Service, respectively. These excise taxes were formerly collected by IRS. See footnote 5, below, for an explanation of the revisions to the excise tax data, starting with the Summer 1997 issue of the Bulletin.

[2] Includes income taxes of estates and trusts which are taxed at the individual income tax rates, but excludes various taxes paid by certain tax-exempt organizations. These latter organizations are also taxed at the individual income tax rates, but, for classification purposes, are included in the corporation income tax collection statistics because the majority of the taxes they paid are subject to the corporation income tax.

Individual income tax collections include that portion of the individual income tax transferred to the Presidential Election Campaign Fund based on indications made by taxpayers on their income tax returns. Presidential election campaign designations and associated amounts are shown in Table 1 for recent calendar-year tax years; designation amounts in recent fiscal years, without regard to tax year, are as follows:
Fiscal year Millions of dollars

 2000 $60.7
 1999 61.0
 1998 63.3
 1997 66.9
 1996 66.3
 1995 68.5
 1994 69.7
 1993 27.7
 1992 29.6
 1991 32.3
 1990 32.5
 1989 32.3
 1988 33.2
 1987 33.2


Collections of income tax of estates and trusts in fiscal years, without regard to tax year, are as follows:
Fiscal year Billions of dollars

 2000 $16.7
 1999 14.3
 1998 14.2
 1997 11.2
 1996 8.0
 1995 5.3
 1994 6.2
 1993 6.0
 1992 6.1
 1991 4.8
 1990 5.9
 1989 6.0
 1988 6.5
 1987 8.4


[3] Includes various taxes applicable to tax-exempt organizations, including the tax on "unrelated business income." Such taxes also include the taxes paid by certain tax-exempt trusts at the individual income tax rates; however, these taxes were combined with the corporation income tax collections when tabulated. Total taxes collected in recent fiscal years, without regard to tax year, from organizations otherwise tax-exempt are as follows:
Fiscal year Total Unrelated
 business
 income tax

 (Millions of dollars)

 2000 $674.8 $553.6
 1999 810.8 665.9
 1998 689.8 473.2
 1997 666.8 484.9
 1996 699.9 501.9
 1995 484.9 294.3
 1994 571.5 372.4
 1993 342.7 173.6
 1992 379.5 181.6
 1991 288.2 155.6
 1990 304.0 127.9
 1989 271.4 115.6
 1988 284.0 137.5
 1987 244.3 119.9


[4] See footnotes 1 and 7.

[5] Data shown for the Bureau of Alcohol, Tobacco and Firearms (ATF) also include data for the Customs Service. To preserve the historical time series interrupted by the transfer of collection of the manufacturers' excise taxes paid on alcohol and tobacco and of the manufacturers' excise taxes on recreational products for the taxes paid on firearms from IRS to ATF starting in July 1987 and January 1991, respectively, the combined excise taxes for these two Treasury agencies are shown in Table 17 alongside the excise tax collections, as reported by IRS, in fiscal years beginning with 1988, and have been added to the total tax collections reported by IRS to show a grand total of all Treasury Department tax collections (with the exception of cargo excise taxes collected by the Customs Service). For a description of how the excise tax collections data were allocated between IRS and the Bureau of Alcohol, Tobacco and Firearms and the Customs Service, see footnote 7 and the "Notes," below. For a description of the excise tax collection statistics presented in the Bulletin prior to the Summer 1997 issue, see footnote 5, Table 17 of that issue.

[6] Employment taxes include:

(a) Old-Age, Survivors, Disability, and Hospital Insurance (OASDHI) taxes, i.e., Social Security taxes, levied on salaries and wages (under the Federal Insurance Contributions Act, FICA). Amounts collected in recent fiscal years are as follows:
Fiscal year Billions of dollars

 2000 $593.3
 1999 555.3
 1998 513.9
 1997 484.0
 1996 455.2
 1995 394.4
 1994 409.6
 1993 381.1
 1992 365.2
 1991 349.3
 1990 336.3
 1989 317.8
 1988 289.9
 1987 252.6


(b) Social Security taxes levied on "self-employment income" (under the Self-Employment Insurance Contributions Act, SECA). Amounts collected in recent fiscal years are as follows:
Fiscal year Billions of dollars

 2000 $34.6
 1999 32.2
 1998 32.6
 1997 34.0
 1996 26.9
 1995 60.9
 1994 24.4
 1993 20.6
 1992 24.4
 1991 25.5
 1990 21.3
 1989 19.0
 1988 17.7
 1987 14.0


(c) unemployment insurance taxes (under the Federal Unemployment Tax Act, FUTA). Amounts collected in recent fiscal years are as follows:
Fiscal year Billions of dollars

 2000 $7.0
 1999 6.7
 1998 6.5
 1997 6.2
 1996 6.0
 1995 5.8
 1994 5.6
 1993 5.6
 1992 5.8
 1991 5.5
 1990 5.5
 1989 4.7
 1988 6.2
 1987 6.2


(d) railroad retirement (carriers) tax. Amounts collected in recent fiscal years are as follows:
Fiscal year Billions of dollars

 2000 $4.8
 1999 4.5
 1998 4.8
 1997 4.4
 1996 4.3
 1995 4.3
 1994 4.2
 1993 4.3
 1992 4.4
 1991 4.2
 1990 4.2
 1989 4.1
 1988 4.3
 1987 4.2


[7] Although responsibility for the administration of alcohol and tobacco excise taxes was transferred to the Bureau of Alcohol, Tobacco and Firearms (ATF) effective July 1, 1987, i.e., with the beginning of the fourth quarter of Fiscal Year 1987, the taxes collected were treated as Internal Revenue Service tax collections (column 4) through September 30, 1987, i.e., through the end of the fourth quarter of Fiscal Year 1987, rather than of ATF collections (column 5), as a transitional measure.

NOTES: In general, collections represent the gross amounts before refunds and include (a) amounts paid with the tax return, (b) amounts paid prior to filing the return, as applicable (income tax withheld by employers and "estimated tax" payments), and (c) amounts paid subsequent to filing the return (chiefly the result of initial IRS administrative return processing or later examination and enforcement activities). Collections also include interest and penalties, but do not reflect any revisions to the IRS data for specific fiscal years made after the close of the fiscal year. Instead, revisions are reflected in the data for the later fiscal year in which the revision was made.

Collection statistics reported by the Internal Revenue Service are not altogether comparable to those published by the Financial Management Service, also in the Treasury Department, because of timing differences resulting from the definitions each agency uses. The Internal Revenue Service counts the monies as they are received (to reflect the status of its tax collection operation); the Financial Management Service counts these amounts as received, but only after discrepancies (such as between what the employer reports as tax withheld and the amount actually withheld) are resolved. Also, the Financial Management Service classifies the tax collected according to the Federal Budget account to which the tax receipts are assigned (so that, for example, the former "environmental tax" reported on the corporation income tax return was not included in Treasury's monthly corporation income tax statistics because, by law, collections of this tax were assigned to the environmental "Superfund," rather than to the General Fund to which most income taxes are assigned. In contrast, this tax was classified as a part of the corporation income tax in Internal Revenue Service statistics).

For purposes of Table 18 (and to facilitate comparisons with Table 21), the grand totals of all excise taxes were obtained by accumulating data from the Treasury Monthly Statement (see also the citation under Source, below). Totals for excise taxes collected by IRS were then subtracted from these grand totals to derive the combined totals shown as having been collected by the Bureau of Alcohol, Tobacco and Firearms and the Customs Service.

SOURCE: U.S. Department of the Treasury, Internal Revenue Service, Internal Revenue Service Data Book and Chief Financial Officer, Office of Finance, Revenue Accounting Division, Office of Revenue Systems; and Financial Management Service, Monthly Statement on Receipts and Outlays of the United States Government, monthly.

Table 19 (18)

[1] Even though the Bureau of Alcohol, Tobacco and Firearms (ATF) and the Customs Service have had responsibility for collecting and refunding excise taxes on alcohol, tobacco, and firearms since July 1987 (in the case of alcohol and tobacco taxes) and since January 1991 (in the case of taxes on firearms), the Internal Revenue Service (IRS) continues to be responsible for the recording of refunds of these taxes. Consequently, IRS statistics for excise tax refunds include refunds made by ATF and the Customs Service in years subsequent to dates on which organizational responsibility was transferred. ATF and Customs Service excise tax collections, on the other hand, are recorded by these two Treasury agencies and are, therefore, shown separately in Table 18 under the heading, Bureau of Alcohol, Tobacco and Firearms. See also footnote 4.

[2] Includes refunds of taxes paid on the "unrelated business income" of certain tax-exempt trusts. Also, to preserve the year-to-year comparability of the historical series, individual income tax refund data have been revised starting 1996 to, again, include net refunds due to the "earned income credit" in addition to overpayment and other refunds (see also footnote 35, Table 1). This credit is already reflected in the refund statistics for previous years. Therefore, refund data do not agree with those presented in the annual Internal Revenue Service Data Book, starting with 1996, although, conceptually, they agree with refund data published in the Treasury Department's Monthly Statement of Receipts and Outlays of the United States Government (see also the citation under Source, below).

Individual income tax refunds are net of offsets under laws that require the Department of the Treasury to act as collecting agent for delinquent payments owed various U.S. Government agencies under specific programs. See Table 20 (which is by calendar year rather than by fiscal year).

[3] Includes refunds of taxes on the "unrelated business income" of tax-exempt organizations, except for certain trusts.

[4] See footnote 1. Also, as further explained in the "Notes" to Table 21, taxpayers can offset certain refundable excise tax payments against the tax of subsequent time periods and claim certain other refunds as a credit against income tax; however, these amounts are not reflected in the excise tax refund statistics.

[5] The kinds of employment taxes subject to refund are listed in footnote 6, Table 18.

NOTE: Refund data include interest paid on the refunds by IRS (or the Bureau of Alcohol, Tobacco and Firearms), as shown below. See also the "Notes" to Table 18.
Fiscal year Total Individuals Corporations

 (Billions of dollars)

 2000 $2.7 $.5 $2.0
 1999 2.7 .4 2.2
 1998 2.6 .3 2.1
 1997 2.4 .4 1.8
 1996 2.2 .3 1.6
 1995 2.7 .4 1.7
 1994 3.1 .3 2.3
 1993 2.1 .4 1.6
 1992 3.2 .4 2.1
 1991 2.8 .5 2.0
 1990 2.4 .5 1.4
 1989 1.8 .5 n.a.
 1988 1.7 .4 n.a.
 1987 2.0 .4 n.a.

SOURCE: U.S. Department of the Treasury, Internal
Revenue Service, Internal Revenue Service Data Book
and Chief Financial Officer, Office of Finance, Revenue
Accounting Division, Office of Revenue Systems.


Table 20 (19)

[1] Represents repayments to specific Federal agencies (or State treasuries) for debts, such as student loans, mortgage and loan foreclosures, dishonored checks, and overpayments of benefits. There was no refund offset program prior to Fiscal Year 1982. Data are shown by year in which offset was made, regardless of tax year.

Starting January 1999, the IRS tax refund offset program was merged into the Treasury-wide offset program. This combined U.S. Government debt collection program is administered by the Financial Management Service (FMS), Department of the Treasury. (The sharp increase in tax refund offsets for 1999 (to $2.6 billion) was attributed by FMS to (1) system enhancements made which include offset matching on the Social Security numbers of both husbands and wives as reported on joint individual income tax returns, (2) increased debt referrals for child support and Federal non-tax debt, (3) system flexibility allowing creditor agencies to add and update debt records on a continuous basis, and (4) increases in the average number and amount of tax refund payments due in part to new tax credits. For additional information, see U.S. Department of the Treasury, Financial Management Service, Annual Report to the Congress: U.S. Government Debt Collection Activities of Federal Agencies, Fiscal Year 1999.)

[2] After 1990, number of offsets includes adjustments for injured spouse claims filed with the original tax return. See also footnote 1.

[3] For all years, data exclude fees charged by the Internal Revenue Service or the Financial Management Service. For years preceding 1999, data by program or Federal agency represent the net amounts offset against refunds, after injured spouse claims and other types of reversals. Starting with 1999, the totals by program or Federal agency are the gross amounts before injured spouse claims and other types of reversals, with the reversals shown separately as summarized totals. However, the grand totals for 1999 are comparable to those shown for the earlier years.

[4] From 1992 through 1994, the Social Security Administration (SSA) participated in the refund offset program as part of the Department of Health and Human Services (HHS), but, starting in 1995, SSA became an independent agency. Nevertheless, SSA refund offsets are shown separately for all these years, and are not included in the HHS totals for 1992-1994.

[5] Represents repayments to State treasuries for funds disbursed to families receiving State assistance and for funds distributed under the Temporary Assistance for Needy Families (TANF) program, before 1997 known as the Aid to Families with Dependent Children (AFDC) program.

[6] Represents repayments to State treasuries for distribution to custodial parents (non-TANF). (See also footnote 5, above).

[7] Before 1996, known as the Public Health Service.

[8] Includes affiliated exchange services.

SOURCE: U.S. Department of the Treasury. For years starting with 1999, Financial Management Service. For previous years, Internal Revenue Service.

Table 21 (20)

[1] Tax liability statistics include "collections" of use tax on heavy highway vehicles and of crude oil windfall profit tax. See also the notes below.

[2] Represents aggregates for two or more specific taxes for which amounts have either been combined or are not available separately.

[3] This tax is in addition to the regular tax on gasoline.

[4] Includes small amounts of taxes on alcohol, tobacco, and firearms collected by the Internal Revenue Service after July 1, 1987, (for alcohol and tobacco taxes), and after January 1, 1991, (for firearms taxes), for tax liabilities incurred previously. (Effective with or during Fiscal Years 1988 and 1991, responsibility for new tax liabilities was transferred to the Bureau of Alcohol, Tobacco and Firearms.)

[5] Starting with Fiscal Year 1998, includes excise taxes collected through the Federal Tax Deposit (FTD) system, which the Internal Revenue Service had not yet classified by type of excise tax. Classification is based on returns filed in the quarter following tax payment. Negative amounts for "unclassified" result from subsequent classification of the previously unclassified taxes. For fiscal years before 1998, "unclassified" taxes are included in the statistics for "Internal Revenue Service collections less reported amounts." See also "Notes" below.

[6] Tax "liability" statistics shown for the Customs Service/Bureau of Alcohol, Tobacco and Firearms include tax "collections" on imported items for which the Customs Service is responsible. See the note below for additional information.

[7] Taxes on the different types of domestic tobacco products are before post-filing tax adjustments. Therefore, the statistics by type of tax for domestic tobacco will not add to the total for tax on domestic tobacco, which is after these adjustments. See also the "Notes" below.

NOTES: Grand totals for taxes shown for the Internal Revenue Service (IRS), the Bureau of Alcohol, Tobacco and Firearms (ATF), and the Customs Service represent tax "collections." (Taxes on certain cargoes treated as excise taxes under the Internal Revenue Code are also collected by the Customs Service, but are excluded from Table 21 for consistency with the excise tax definitions and totals published in the Federal Budget. Also excluded is an environmental excise tax reported on the corporation income tax return for 1987 through 1996 and collected as part of the corporation income tax.) Prior to Fiscal Year 1998, all other Table 21 data (with the exceptions noted below) represent tax "liabilities" as reported on excise tax returns.

For the grand totals, collections rounded to millions of dollars are all that are available. In general, amounts shown are the gross amounts, i.e., before refunds. However, as explained below, refunds are sometimes claimed as a credit against the tax reported on the excise tax return of a subsequent quarter and, to this extent, the data are after refunds.

"Floor stocks taxes" are shown separately in Table 21 because they are nonrecurring. They are generally imposed on holders of inventories on the date a new excise tax is imposed or a tax rate increased.

Total collections represent tax payments made during the indicated fiscal year (or quarter), either through: (a) the semimonthly tax deposits required of most taxpayers with significant excise tax liabilities using Federal Tax Deposit (FTD) coupons, in the case of taxes collected by IRS, or Electronic Funds Transfers (EFT's), in the case of taxes collected by ATF/ Customs, or (b) payments attached to quarterly excise tax returns. Prior to FY 1998, excise tax collections by the Treasury Department were accounted for without identifying the specific types of excise tax to which the payments applied. Therefore, the only statistics on the specific types of tax for these years are for the tax "liabilities," which are reported by type on the excise tax return. There were three exceptions: the use tax on heavy highway vehicles and the crude oil windfall profit tax, both administered by IRS, which taxpayers were required to account for separately when taxes were paid, and the taxes on imports administered by the Customs Service. As a result, "collections," rather than "liabilities," for each of these three types of tax are included in the Table 21 statistics for all years.

Beginning with FY 1998, statistics for both the total for taxes administered by the IRS and the taxes by type of tax represent tax "collections"; see below. For FY 1994 through FY 1997, the amounts shown for the total represent tax collections, while the taxes by type of tax represent the tax liability reported on excise tax returns. For these latter years, statistics on the types of tax take into account the normal lag that exists between the time most taxes are collected (through FTD's, the means by which most excise taxes are collected), and the recording of tax liabilities by type of tax as reported on excise tax returns and "certified" by IRS. For additional information, see the notes to Table 20, Statistics of Income Bulletin, Fall 1998, Volume 18, Number 2, and also "Federal Excise Taxes, Fiscal Years 1994 and 1995," Fall 1996, Volume 16, Number 2. For years preceding FY 1994, the lag between time of tax deposit and time of filing was not taken into account, so that statistics for collections in a quarter were matched with tax liabilities "certified" during the same quarter. Consequently, the match for these earlier years is less accurate, and there is a break in comparability between 1993 and 1994 as a result. (The IRS "certification" process is described below.)

a. Statistics on excise taxes administered by the Internal Revenue Service:

For years before FY 1998, the table entry for IRS "collections less reported amounts" is a balancing amount, representing the difference between the tax collected and the IRS "certified" tax liability. It, therefore, reflects the timing adjustments taken into account for the statistics in recognition of: (1) the lag between time of tax payment and time of filing the return and (2) the previous inability of equating tax payments with the tax liability reported on the excise tax return. Inasmuch as the difference between the certified tax liability and the tax collected was apportioned in order to make the tax liability and the tax collected equal starting with FY 1998, there are no entries for "collections less reported amounts," starting with that year.

Corrections to the IRS data are reflected in the quarter(s) and year in which the corrections were made, rather than in the data for the quarter(s) and year in which the original tax liability arose (unlike the ATF/Customs data). The certified tax is net of refund credits reported on excise tax returns, not only for this reason, but for consistency with the Internal Revenue Code. As examples, tax can be offset for commodities exported that were previously taxed (exports are usually nontaxable), or for the sale of previously-taxed gasoline to a State or local Government (or, in the case of ATF taxes, for alcohol used for a nonbeverage purpose). Other taxpayers apply directly for refunds and, for some of the taxes, are allowed to claim refunds by means of a credit against income tax. Because such refundable amounts were not reported on the excise tax return, they are not reflected in the Table 21 totals. (Other corrections, to the IRS data for certain specific taxes, are assumed to be due to misclassification and have been adjusted for as additions (or subtractions) to "Miscellaneous IRS taxes.")

b. Statistics on excise taxes administered by the Bureau of Alcohol, Tobacco and Firearms and the Customs Service:

Excise taxes on alcoholic beverages and tobacco products are collected by both Customs Service (on imports) and ATF (on domestic production). Taxes on firearms and certain occupational taxes are also collected by ATF. ATF tax liability statistics, for all of the years shown in Table 21, are presented in more detail, beginning with the Summer 1998 Bulletin (formerly, this was Table 20). The less detailed ATF statistics shown for each year in previous issues of the Bulletin also represent tax "liabilities" on domestic alcohol and tobacco productions, as well as tax "liabilities" on firearms and certain occupations. In contrast, the taxes on imported alcohol and tobacco production reported by the Customs Service are tax "collections" in data for all years.

The grand totals for ATF and Customs Service tax "collections," as presented in Table 21, are residual amounts. They were derived by subtracting total IRS tax collections, which are available before most refunds, from the grand total of all excise tax gross collections reported in the Monthly Treasury Statement, rounded to millions of dollars, as shown at the beginning of Table 21.

In Table 21, ATF data have been rearranged, starting with the Spring 1997 Bulletin (then Table 20), so that tax liabilities are matched with tax collections in that same quarter. Previously, tax liabilities arising in a given quarter were not directly related to reported tax collections during that same quarter. Also, as previously noted, ATF amounts are often revised slightly as late returns are processed or post-filing adjustments are made to the tax. As a result, tax reported for prior periods is updated on a continuing basis (although the prior-year data are actually retabulated only for the one, most recent, prior year). Data for detailed types of taxes on domestically-produced tobacco, starting with the Fall 1998 version of Table 21 (then Table 20), are available only before such updating. Therefore, the computed sum of the detailed tobacco taxes by type will not equal the total shown for all tobacco taxes, which is after updating.

SOURCE: U.S. Department of the Treasury, Financial Management Service, Monthly Treasury Statement of Receipts and Outlays of the United States Government; Bureau of Alcohol, Tobacco and Firearms, Statistical Release: Alcohol, Tobacco and Firearms Tax Collections, quarterly (this release also includes data for the Customs Service), and previously-unpublished special tabulations; Internal Revenue Service, Internal Revenue Service Data Book, and its predecessor, Annual Report, Commissioner and Chief Counsel, Internal Revenue Service; also Chief Financial Officer, Office of Finance, Revenue Accounting Division, Office of Revenue Systems, Internal Revenue Report of Excise Taxes, for fiscal years before 1994, previously-unpublished corrected data for 1994 and 1995, and data for 1996 (unrevised data for 1994 and 1995 were published in Davie, Bruce F., "Federal Excise Taxes, Fiscal Years 1994 and 1995," Statistics of Income Bulletin, Fall 1996, Volume 16, Number 2). See also (unrevised) data included in Davie, Bruce F., "Excise Taxes, Fiscal Year 1992," Statistics of Income Bulletin, Fall 1993, Volume 13, Number 2, and data in Francis, Brian D., "Excise Taxes, Fiscal Years 1995-1997," Statistics of Income Bulletin, Spring 1998, Volume 17, Number 4. For additional information about the process used to match quarterly excise tax "collections" with excise tax "liabilities" as reported on quarterly excise tax returns, see the "Notes" to Table 20 in the Fall 1998 (Volume 18, Number 2) issue of the Statistics of Income Bulletin.

Table 22 (21)

[1] Form 1040 is the "long form," and Form 1040A, one of the two (three for Filing Year 1996) "short forms." Starting with Filing Year 1991, use of Form 1040A was expanded to reflect provisions designed to facilitate usage by elderly taxpayers. Prior to 1994, Form 1040EZ, the other "short form" (introduced in 1983), was for single taxpayers with no dependents; starting in 1994, certain married taxpayers with no dependents could also use this form. The types of income that could be reported on Form 1040EZ were also expanded, starting in 1996, to include unemployment compensation. (For Filing Year 1996, the third "short form" was Form 1040-T, an experimental form, discontinued after this one year). Form 1040PC, introduced in 1992, was the equivalent of a "paper" Form 1040, 1040A, or 1040EZ return for which an IRS-approved computer software-generated compressed format is used. Schedule C is for reporting nonfarm sole proprietorship business profits, and Schedule F is for reporting farm sole proprietorship business profits.

Starting with Filing Year 1986, the reported data for total Forms 1040, 1040A, 1040EZ, and 1040PC returns, and for Forms 1040-T (for 1996), as well as the totals for nonbusiness and business Form 1040 returns with Schedules C or F attached, are comprised of "paper" returns, plus "standard" electronically-filed ("ELF" or "e-file") returns (usually filed by authorized third parties, such as paid preparers). Starting in 1992, the electronically-filed totals also include returns filed by touch-tone telephone ("TeleFile").

The last category under individual income tax returns is comprised of Form 1040C (departing alien) for filing years preceding 1992; 1040NR (nonresident alien); 1040PR (self-employment tax, Puerto Rico); and 1040SS (self-employment tax, U.S. Virgin Islands, Guam, American Samoa, and the Northern Mariana Islands). Amended returns filed on Form 1040X are excluded.

[2] Form 1120 is the basic corporation income tax return. Form 1120A is the "short form" (introduced in Filing Year 1985; filers formerly used the Form 1120 long form). Form 1120S is for S corporations (certain qualifying small corporations electing to be taxed through shareholders; to qualify, such corporations could have no more than 75 shareholders starting in 1998, no more than 35 shareholders in 1984-1997, no more than 25 in 1983, no more than 15 in 1981-1982, and no more than 10 prior to 1981). "Other" includes Forms 1120-F (most foreign companies with U.S. income); Forms 1120-L (domestic and foreign life insurance companies), which are combined with Form 1120 statistics for years before 1995; Forms 1120POL (certain political associations); Forms 1120-H (homeowners' associations); Forms 1120-FSC (Foreign Sales Corporations, or FSC's), starting in 1986; Forms 1120-REIT (Real Estate Investment Trusts) and 1120-RIC (Regulated Investment Companies) starting in 1988 (filers formerly

used Form 1120); and Forms 1120-PC (Property and Casualty Insurance Companies), starting in 1987 (filers formerly used Forms 1120 or 1120M, described below). "Other" also includes Form 1120SF (for certain settlement funds); Form 1120DF (for nuclear decommissioning trust funds and certain related persons), starting in 1988; and, for years before 1988, Form 1120M (now discontinued) for most mutual nonlife insurance companies that now file Form 1120 or 1120-PC (and are included in the statistics for Form 1120 in the years preceding 1988). After 1985, "other" excludes Form 1120-DISC for Domestic International Sales Corporations, which were discontinued and mostly replaced by FSC's (see above); and Form 1120 IC-DISC for Interest-Charge Domestic International Sales Corporations (which was used by certain other DISC's after 1985). Amended returns filed on Form 1120X are excluded.

[3] Includes Form 1065B for certain large partnerships, starting 1999.

[4] Form 1041 is the regular income tax return filed for estates and trusts. For 1988-1990, includes Form 1041S (short form).

[5] Form 706 is the regular estate tax return; Form 706NA is for U.S. estates of nonresident aliens; Forms 706 GS(D) and 706 GS(T) are for estate tax returns for which the generation-skipping transfer tax applies.

[6] Form 990 is for tax-exempt organizations, except private foundations (Form 990-PF). Form 990EZ is the short form. Form 990-T is the income tax return filed for businesses conducted by tax-exempt organizations. Form 990-C is for farmers' cooperatives. Form 4720 is for computing the special excise taxes applicable to certain private foundations, and Form 5227 is for split-interest trusts treated as private foundations.

[7] Form 940 is the annual unemployment (FUTA) tax return filed by employers; Form 940PR is used by employers in Puerto Rico; and Form 940EZ is a shorter version of Form 940. Form 940EZ is only included in the Form 940 totals for 1990 and subsequent years. Form 941 is the employer's quarterly return for income tax withheld; Form 941PR is used by employers in Puerto Rico; and Form 941SS, by employers in the U.S. Virgin Islands, Guam, American Samoa, and the Northern Mariana Islands. Form 941M (monthly tax withholdings) is included with Form 941 in 1980 and prior years. Form 943 is filed to report income tax withheld by employers for agricultural employees. Form 943PR is used by employers in Puerto Rico. "Other" includes Form 945 (annual tax withholding from non-payroll distributions), included in 1995 and subsequent years; Form 942 (quarterly return for household employees) discontinued after 1995; Form 942PR (quarterly return for household employees filed by Puerto Rico employers); Form CT-1 (annual railroad retirement and unemployment tax return); and Form CT-2 (representative's quarterly railroad tax return), not included in years following 1980.

[8] Form 720 is the IRS quarterly excise tax return and includes related Form 720M for 1980 and prior years. Form 2290 is the IRS return used to report heavy highway vehicle use tax. "Other" includes Form 730 (tax on wagering); Form 11C (occupational tax and registration return for wagering); and Form 11B (tax on gaming devices) for 1980 and prior years. (Excise tax returns exclude those filed with the Bureau of Alcohol, Tobacco and Firearms and Customs Service.)

SOURCE: U.S. Department of the Treasury, Internal Revenue Service, Assistant Deputy Commissioner Operations, Office of Research, Analysis and Statistics of Income, Office of Research.

Table 23 (22)

[1] Number of returns with a paid preparer signature is based on different sources, depending on the year. Data for 1995-1999 are based on the sample used for Statistics of Income--Individual Income Tax Returns. Data for 1990 are from the full IRS Individual Master File, rather than from a sample, except for the number of returns with itemized deductions and the number filed electronically. These latter numbers were estimated from the sample of returns used for the Statistics of Income--Taxpayer Usage Study (TPUS) that were filed during the first 4 months of 1991.

[2] Data on electronically-filed returns are included in the counts of Form 1040 returns, shown above in Table 23, for all years. For Tax Year 1990, data are based on the TPUS samples (see footnote 1) of returns filed, extended to cover the first 8 months of the filing years. No adjustment was made for the returns filed after the first 8 months on the assumption that few were likely to have been filed electronically during these months. Starting with Tax Year 1992, data are based on the full Statistics of Income samples of returns filed throughout the entire filing year.

[3] Data on IRS taxpayer assistance programs are actually for the fiscal year. In general, assistance rendered in a given fiscal year may be associated with returns due on April 15 of that fiscal year and is, therefore, for the tax year ending with the previous December. As a result, data in Table 23 on taxpayer assistance, shown as for Tax Year 1999, for example, are actually for Fiscal Year 2000.

NOTE: Data on IRS assistance represent taxpayer contacts, unless otherwise indicated. Some taxpayers are contacted more than once. The number of taxpayers assisted (in contrast to the number of taxpayers contacted) is not known.

SOURCE: Data on paid preparers were obtained from Statistics of Income; and from Assistant Deputy Commissioner, Modernization/Chief Information Officer. Data on IRS assistance were obtained from the Annual Report, Commissioner and Chief Counsel, Internal Revenue Service for Fiscal Year 1991 and the Internal Revenue Service Data Book, starting with Fiscal Year 1995 and including the report for Fiscal Year 2000 (in preparation at time of publication of this issue of the Bulletin).
COPYRIGHT 2001 U.S. Government Printing Office
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2001 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:Statistics of Income. SOI Bulletin
Article Type:Statistical Data Included
Geographic Code:1USA
Date:Mar 22, 2001
Words:17039
Previous Article:Foreign Corporations with Income Effectively Connected with a U.S. Trade or Business, 1995.
Next Article:SOI Projects and Contacts.
Topics:

Terms of use | Privacy policy | Copyright © 2019 Farlex, Inc. | Feedback | For webmasters