TY  - JOUR
TI  - Taxpayer Confusion: Evidence from the Child Tax Credit
AU  - Feldman, Naomi E.
AU  - Katuš čÁk, Peter
AU  - Kawano, Laura
PY  - 2016
PB  - American Economic Association
LA  - eng
AB  - We develop an empirical test for whether households understand or misperceive their marginal tax rate. Our identifying variation comes from the loss of the Child Tax Credit when a child turns 17. Using this age discontinuity, we find that despite this tax liability increase being lump-sum and predictable, households reduce their reported wage income upon discovering they have lost the credit. This finding suggests that households misinterpret at least part of this tax liability change as an increase in their marginal tax rate. This evidence supports the hypothesis that tax complexity can cause confusion and leads to unintended behavioral responses. (JEL D12, D14, H24, H31)
UR  - https://doi.org/10.1257/aer.20131189
DO  - 10.1257/aer.20131189
T2  - American economic review
VL  - 106
IS  - 3
SN  - 1944-7981
SN  - 0002-8282
SP  - 807-835
UR  - https://www.pollux-fid.de/r/cr-10.1257/aer.20131189
H1  - Pollux (Fachinformationsdienst Politikwissenschaft)
ER  -