This year’s Statistics
of Income hard copy publication is a small part of what has been published
in past years. The balance, however is available on the Internet at:
http://tax.utah.gov/esu/income/fed02/fed02.htm
This volume duplicates a
copy of the publication Web page to give the reader an idea of what is
available after the data description. Although economy was the main reason for
publishing the report on the Web, there are advantages: previous years data is close
at hand and need not be found, with some work it can be loaded into other
applications, and corrections or updates or afterthoughts can be added easily.
In past years we have
published a separate volume entitled FAMILY BASED STATISTICS OF INCOME.
(See below for an explanation.) Since the volume is now smaller and also for
reasons of economy, the two volumes now appear as one.
Utah Statistics of
Income
series summarizes and analyzes tax return data available from the Internal
Revenue Service (IRS) through the federal‑state exchange program.
Two different data tapes
are available from the IRS. The first, called the master file, contains
very basic information from the 1040 form, such as federal taxes, adjusted
gross income (AGI), deductions and the number of exemptions claimed. The
second source contains most of the individual tax form lines, such as detail on
deductions and sources of income. The detailed source is not updated to reflect
amendments and is not as thoroughly edited for errors as the first source.
Thus, the data are not 100 percent correct, but in most cases are reliable for
general orders of magnitude and averages. Since the two sources are not
at the same phase in processing when the state tapes are made, totals from the
two sources are generally not identical, although usually very close.
Either differences in IRS processing speed or the timeliness of taxpayers in
filing returns will cause discrepancies. This may result in slight differences
on some tables in items such as AGI, deductions, or the number of taxpayers.
The IRS's tax data
always contain information from prior‑year returns that are filed late.
We generally include prior‑year returns since their omission would result in a
serious under-reporting of the various income and tax magnitudes. In a
sense, 2001 prior‑year (2000) data is a proxy for returns for 2001 that will be
filed late. Prior‑year returns are included as a separate
"county" in the county tables and are not included in either the city
or ZIP Code data, since we believe the inclusion of the data at the state level
is reliable, but that its allocation to lower level geographic units is
questionable.
In addition to state,
county, city, and ZIP Code data on adjusted gross income, federal taxes,
exemptions, and returns by income level, this volume reports statewide data on
itemized deductions, adjustments to income, sources of income, and other
important magnitudes from federal tax schedules C through F , as well as for
various credits and tax payments.
The data on a Utahn’s
income is AGI, which is not the same concept as either the census definition or
personal income. AGI includes capital gains, which most definitions of income do
not cover, and only captures a portion of social security income and pension
income. In addition, a list of adjustments, such as IRA and Keogh plans, self
employed health insurance, moving expenses, alimony paid, etc. are subtracted
to arrive at AGI. AGI also excludes the imputed income included in personal
income measures.
We are subject to the
way taxpayers fill out their forms as far as addresses are concerned. If
they use a wrong ZIP Code, we are forced to live with it. Probably the
most important error of this type is in the "city" taxpayers
claim. Some residents of the smaller communities, for example, may list
Salt Lake City as a city rather than Sandy, or Murray, for example. This
also happens for residents of unincorporated areas. Some taxpayers will also
use their professional address or post office box rather than their actual
residence.
To understand what is
included in federal taxes, please consult the attached form 1040. This figure
is what is reported on the total tax line, but self-employment taxes are not
included, while alternative minimum taxes are included as well as some other
small items. Credits have been subtracted, except the earned income tax, which
is considered a payment by the IRS.
In addition, average
values are only averages for taxpayers using a particular form or line.
This
report represents an ongoing effort at the Utah State Tax Commission’s Economic
and Statistical Unit to calculate family-based data from individual returns.
Since the raw data is based on tax returns and tax definitions of income, and
since the aggregation is not perfect, this data should not be expected to
conform to other sources of family or household data. This report groups
returns into larger units, such as households or families. It groups returns
that show the same last name, ZIP Code, and first part of the address into a
unit, generally a family. This method adds minors with their parents, if they
use the same name and address. It also groups a married couple living with the
husband's parents (same last name). However, it would not group a married
couple living with the wife's parents (different last names).