Distribution of Education Tax Benefits by Income over Time

The implementation of the American Opportunity Tax Credit in 2009 shifted a large share of the benefits of the education tax credits from filers with incomes between $25,000 and $100,000 to those with higher incomes and a small share to those with lower incomes.

Figure 22A: Distribution of Education Tax Credits by Adjusted Gross Income, 2004, 2009, and 2014

Figure 22A represents Distribution of Education Tax Credits by Adjusted Gross Income, 2004, 2009, and 2014. For a corresponding Section 508-compliant data table, download the Excel spreadsheet.

Notes & Sources 

NOTES: The total and average values of tax credits and deductions are best estimates based on data from the Internal Revenue Service. A portion of nonrefundable dollars claimed on nontaxable returns is excluded to account for credits and deductions that do not reduce tax liability. The value of tax deductions is estimated based on applicable marginal tax rates. Percentages may not sum to 100 because of rounding.
 
SOURCES: Internal Revenue Service, Statistics of Income 1999 to 2015, Tables 1, 1.3, 1.4, 2, 3.3; calculations by the authors.
  • In 2004, 15% of the credits went to filers with incomes below $25,000. None of the credits went to filers with incomes of $100,000 or higher. In 2014, 24% of the credits went to filers with incomes below $25,000 and 24% went to those with incomes of $100,000 or higher.