Jobs and Growth Tax Relief Reconciliation Act of 2003
Pub. L.108–27 (text) (PDF) | |
Statutes at Large | 117 Stat. 752 |
---|---|
Legislative history | |
| |
Major amendments | |
Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 |
The Jobs and Growth Tax Relief Reconciliation Act of 2003 ("JGTRRA",
Among other provisions, the act accelerated certain tax changes passed in the
Description of cuts
JGTRRA continued on the precedent established by the 2001 EGTRRA, while increasing tax reductions on investment income from dividends and capital gains.
Accelerated credits and rate reductions
JGTRRA accelerated the gradual rate reduction and increase in credits passed in EGTRRA. The maximum tax rate decreases originally scheduled to be phased into effect in 2006 under EGTRRA were retroactively enacted to apply to the 2003 tax year. Also, the child tax credit was increased to what would have been the 2010 level, and "marriage penalty" relief was accelerated to 2009 levels. In addition, the threshold at which the alternative minimum tax applies was also increased.
Investments
JGTRRA increased both the percentage rate at which items can be
In addition, the capital gains tax decreased from rates of 8%, 10%, and 20% to 5% and 15%. Capital gains taxes for those currently paying 5% (in this instance, those in the 10% and 15% income tax brackets) are scheduled to be eliminated in 2008. However, capital gains taxes remain at the regular income tax rate for property held less than one year.
Certain categories, such as collectibles, remained taxed at existing rates, with a 28% cap. In addition, taxes on "qualified dividends" were reduced to the capital gains levels. "Qualified dividends" includes most income from non-foreign corporations, real estate investment trusts, and credit union and bank "dividends" that are nominally interest.
Legislative history
Final House vote:
Vote by Party | Yea | Nay | ||
---|---|---|---|---|
Republicans | 224 | 99.6% | 1 | 0.4% |
Democrats | 7 | 3.4% | 198 | 96.6% |
Independents | 0 | 0.0% | 1 | 100% |
Total | 231 | 53.6% | 200 | 46.4% |
Not voting | 4 | 0 |
Final Senate vote:
Vote by party | Yea | Nay |
---|---|---|
Republicans | 48 | 3 |
Democrats | 2 | 46 |
Independents | 0 | 1 |
Total | 50 | 50 |
Vice President Dick Cheney (R): Yea |
Tax bracket comparison
The tax cuts enacted by this legislation were retroactive to January 1, 2003, and first applied to taxes filed for the 2003 tax year. These individual rate reductions are scheduled to sunset on January 1, 2011, along with the Economic Growth and Tax Relief Reconciliation Act of 2001 unless further legislation is enacted to extend or make permanent its changes.
Single
Tax Year 2002[3] | Tax Year 2003[4] | ||
Income level | Tax rate | Income level | Tax rate |
---|---|---|---|
up to $6,000 | 10% | up to $7,000 | 10% |
$6,000 - $27,950 | 15% | $7,000 - $28,400 | 15% |
$27,950 - $67,700 | 27% | $28,400 - $68,800 | 25% |
$67,700 - $141,250 | 30% | $68,800 - $143,500 | 28% |
$141,250 - $307,050 | 35% | $143,500 - $311,950 | 33% |
over $307,050 | 38.6% | over $311,950 | 35% |
Married filing jointly or qualifying widow or widower
Tax Year 2002[3] | Tax Year 2003[4] | ||
Income level | Tax rate | Income level | Tax rate |
---|---|---|---|
up to $12,000 | 10% | up to $14,000 | 10% |
$12,000 - $46,700 | 15% | $14,000 - $56,800 | 15% |
$46,700 - $112,850 | 27% | $56,800 - $114,650 | 25% |
$112,850 - $171,950 | 30% | $114,650 - $174,700 | 28% |
$171,950 - $307,050 | 35% | $174,700 - $311,950 | 33% |
over $307,050 | 38.6% | over $311,950 | 35% |
Married filing separately
Tax Year 2002[3] | Tax Year 2003[4] | ||
Income level | Tax rate | Income level | Tax rate |
---|---|---|---|
up to $6,000 | 10% | up to $7,000 | 10% |
$6,000 - $23,350 | 15% | $7,000 - $28,400 | 15% |
$23,350 - $56,425 | 27% | $28,400 - $57,325 | 25% |
$56,425 - $85,975 | 30% | $57,325 - $87,350 | 28% |
$85,975 - $153,525 | 35% | $87,350 - $155,975 | 33% |
over $153,525 | 38.6% | over $155,975 | 35% |
Head of household
Tax Year 2002[3] | Tax Year 2003[4] | ||
Income level | Tax rate | Income level | Tax rate |
---|---|---|---|
up to $10,000 | 10% | up to $10,000 | 10% |
$10,000 - $37,450 | 15% | $10,000 - $38,050 | 15% |
$37,450 - $96,700 | 27% | $38,050 - $98,250 | 25% |
$96,700 - $156,600 | 30% | $98,250 - $159,100 | 28% |
$156,600 - $307,050 | 35% | $159,100 - $311,950 | 33% |
over $307,050 | 38.6% | over $311,950 | 35% |
See also
- Taxation in the United States
- Starve the beast – Post 1970s taxation/budget policy
References
- ^ "Tax Policy Under President Bush". Cato Institute.
- ^ Bischoff, Bill (2003-05-27). "What the Bush Tax Cut Means for You". smartmoney.com. SmartMoney. Retrieved 2008-10-07.
- ^ a b c d "2002 1040 Instructions" (PDF). IRS.gov. United States Internal Revenue Service. p. 75. Retrieved 2008-10-07.
- ^ a b c d "2003 1040 Instructions" (PDF). IRS.gov. United States Internal Revenue Service. p. 74. Retrieved 2008-10-07.
External links
- Full text of the Act
- Summary of the Act(pdf file)
- Senate Roll Call Vote – Jobs and Growth Tax Relief Reconciliation Act
- The President's Agenda for Tax Relief
- Effective Federal Tax Rates Under Current Law, 2001 to 2014
- Special Report: Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA), Prof. John Wachowicz at the University of Tennessee