Tax-Calculator is an open-source microsimulation model for static analysis of USA federal income and payroll taxes.
When using micro data that represent the USA population, Tax-Calculator can estimate the aggregate revenue and distributional effects of tax reforms under static analysis assumptions.
Tax-Calculator can also process custom-created data on one or more filing units permitting analysis of how tax reforms affect certain people.
Tax-Calculator interacts with other models in the Policy Simulation Library to conduct non-static analysis.
Tax-Calculator is transparent because its Python source code and embedded documentation are publicly available at the Tax-Calculator GitHub repository.
Tax-Calculator can simulate an enormous number of tax reforms because tax policy is parameterized using over 200 parameters that can be changed by users without doing any programming. And even a reform that is not able to be characterized using currently-available parameters can be simulated by writing supplementary Python code that characterizes the reform.
Tax-Calculator can estimate for each filing unit the marginal tax rate generated by a small change in income. Marginal tax rates can be generated for eighteen different kinds of income. And marginal tax rates can be estimated under any parametric tax reform.
Tax-Calculator is extensively tested using hundreds of unit and integration tests that achieve complete code coverage. Also, there is an ongoing cross-model validation effort that uses large randomly-generated samples of filing units to compare results generated by Tax-Calculator with results from other tax models. The cross-model validation work with NBER's TAXSIM-27 model is described here.
If you are already using Tax-Calculator, upgrade using the following command:
conda update -c PSLmodels taxcalc
If you just getting started, read these instructions.
Results will change as Tax-Calculator data and logic improve. A fundamental reason for adopting open-source methods in this project is so that people from all backgrounds can contribute to the models that our society uses to assess economic policy; when community-contributed improvements are incorporated, the model will produce different results.
Please cite the source of your analysis as
#.#.#, author's calculations. If you wish to provide a link to
Tax-Calculator, the preferred URL is:
Additionally, we strongly recommend that you describe the input data used, and provide a link to the materials required to replicate your analysis or, at least, note that those materials are available upon request.