Leonard E. Burman

A Call for Replication Studies

A basic requirement for scientific integrity is the ability to replicate the results of research, and yet, with some occasional historical exceptions, replication has never been an important part of economic research. The absence of replication studies is particularly problematic because empirical economic research is often prone to error (Dewald, Thursby, and Anderson Public Finance Review a The Author(s) 2010 Reprints and permission: sagepub.com/journalsPermissions.nav DOI: 10.1177/1091142110381960 http://pfr.sagepub.com

Distributional effects of defined contribution plans and individual retirement arrangements

This paper incorporates retirement saving incentives into the Tax Policy Center microsimulation model and analyzes the distributional effects of current tax preferences for saving. As a share of income, tax-preferred saving incentives provide the largest benefits to households with income between

Policy Watch: The Expanding Reach of the Individual Alternative Minimum Tax

75,000 and

Tax Expenditures, the Size and Efficiency of Government, and Implications for Budget Reform

500,000, roughly the 80th to 99th percentile of the income distribution. In 2004, the top 20 percent of tax filing units by income will receive 70 percent of the tax benefits from new contributions to defined contribution plans and almost 60 percent of IRA tax benefits.

Effects of Public Policies on the Disposition of Pre-Retirement Lump-Sum Distributions: Rational and Behavioral Influences

The Expanding Reach of the Individual Alternative Minimum Tax focuses on both the original minimum tax and its successor, the individual alternative minimum tax (AMT). The minimum tax and the AMT have applied in the past to a small minority of high-income households. But barring a change in law, this class tax will soon be a mass tax. By 2010, repealing the AMT will cost more than repealing the regular income tax. This report updates an article originally published in the Journal of Economic Perspectives to reflect tax laws passes in 2003 and 2004 and the latest economic projections.

An Analysis of the House GOP Tax Plan

One possible explanation for the difficulty in controlling the budget is that a major component of spending—tax expenditures—receives privileged status. It is treated as tax cuts rather than as spending. This paper explores the implications of that classification and illustrates how it can lead to higher taxes, larger government, and an inefficient mix of spending (too many tax expenditures). The paper then analyzes alternative budgeting approaches that would explicitly incorporate and measure tax expenditures. It concludes by analyzing ways to control tax expenditures (and other spending) and the special challenges presented by tax expenditures.

Is U.S. Corporate Income Double-Taxed?

A variety of public policies aim to influence workers’ disposition of preretirement lump-sum distributions (LSDs) from pensions. We use the implementation of several policy changes as natural experiments to test for rational and behavioral motives for saving behavior. Using data from the HRS and the CPS in the 1980s and 1990s, we find that higher tax rates on cash-outs increase rollovers. Controlling for the overall effective tax rate, structuring the tax as a “penalty” or adding withholding taxes on cashouts significantly increases rollovers. Allowing employers to unilaterally cash out balances for departing employees who do not make their own choice significantly reduces the effects of higher tax rates but boosts the impact of withholding taxes. These results suggest that both behavioral and rational factors influence workers’ choices, that policies relating to pre-retirement cash outs can interact in important ways, and that the government has several levers at its disposal to influence behavior beyond tax penalties.

Pathways to Tax Reform Revisited

This paper analyzes the House GOP tax reform blueprint, which would significantly reduce marginal tax rates, increase standard deduction amounts, repeal personal exemptions and most itemized deductions, and convert business taxation into a destinationbased cash flow consumption tax. Taxes would drop at all income levels in 2017, but the highest-income households would gain the most. Federal revenues would fall by

The Tax Reform Proposals: Some Good Ideas, but Show Me the Money

3.1 trillion over the first decade (static) and

Measuring permanent responses to capital-gains tax changes in panel data

3.0 trillion after accounting for macroeconomic feedback effects. Including added interest costs, the federal debt would rise by at least