Before and after TCJA: Who pays federal income taxes and how much do they pay?
This data brief reviews effective tax rate trends after TCJA income tax reforms and subsequent changes under the OBBBA.
The Tax Cuts and Jobs Act of 2017 (TCJA) introduced a series of federal individual income tax reforms. These included reducing marginal tax rates and adjusting tax brackets, nearly doubling the standard deduction, limiting the state and local tax deduction (SALT), and doubling the child tax credit (CTC), among others. The recently enacted One Big Beautiful Bill Act (OBBBA) made permanent, expanded, and modified many of these provisions.
After accounting for all these changes to individual income taxes, some decreasing and others increasing taxes, how have tax rates on average changed since TCJA? This brief explores average effective tax rates and the distribution of the federal individual income tax burden after TCJA’s enactment.
Data summary
- This data brief reviews trends in average effective tax rates following the implementation of individual income tax reforms introduced by the Tax Cuts of Jobs Act (TCJA), many of which were made permanent, expanded, or augmented by the One Big Beautiful Bill Act (OBBBA).
- Individuals earning over $100,000 per year paid 83.3% of all 2018 federal individual income taxes, up from 81.1% in 2017. The portion of taxes paid by those making over $500,000 per year increased from 38.2% to 40.6%.
- In 2018, 34.7% of people did not pay federal individual income taxes because they did not owe any after accounting for tax deductions and credits, including 75.2% of those making under $25,000 per year.
Keep exploring
- How has TCJA impacted individual income taxes? - In 2025, the One Big Beautiful Bill Act expanded or made parts of the Tax Cuts and Jobs Act permanent. Here's how the TCJA has affected taxes since 2018.
- All about taxes - The One Big Beautiful Bill Act (OBBBA) came with some big tax changes. When do they take effect and what's the tax story so far? Here's your one stop shop for everything taxes.
- Who doesn’t pay federal income taxes? - Whether someone owes federal income tax depends on their income, deductions, and credits. In 2023, 3 in 10 filers owed nothing.
- How much money does the government collect per person? - Individual income taxes accounted for more than half of total revenues for the federal government in 2022.