Taxpayers in New York’s 12th Congressional District, which includes the Upper East Side, may have the least to gain from income-tax cuts in a House bill released last week.
The district, represented by Democrat Carolyn Maloney, has the highest concentration of people who make more than $1 million a year -- those who’d keep paying at the current top marginal tax rate under the legislation.
In a bill that includes sweeping rate cuts for all corporations, many businesses and most individuals, House Republicans left the top individual rate, 39.6 percent, in place for million-dollar earners who are married and file their taxes jointly. For single individuals, that rate would kick in at $500,000.
For much of the past year, President Donald Trump and House Speaker Paul Ryan had called for cutting the top rate to 35 percent -- but leaving it as is for the highest earners may help dampen the suggestion that the bill benefits the wealthy, at least when it comes to the tax they pay on their earnings.
Other elements of the bill -- including its corporate tax cut and a plan to reduce the top tax rate on business income from certain partnerships, limited liability companies and other so-called “pass-through” businesses -- would tend to benefit large investors and high-earning entrepreneurs.
Even in Maloney’s district, it’s relatively rare for tax filers to report million-dollar incomes, according to Internal Revenue Service data from forms filed in 2015. The district had 12,290 filers -- 2.86 percent of the total -- who reported that much.
Data at the congressional district level don’t provide a breakout for individual or joint filers. So they don’t capture the individuals making $500,000 or more who’d also have to pay the 39.6 percent rate, as proposed.
If the bill becomes law, other congressional districts in and near New York, as well as those around Silicon Valley, San Francisco, Houston and Dallas would also see the most filers subject to the top bracket.
This article was provided by Bloomberg News.