The New Full-time Employment Taxes

NBER Working Paper No. 20580

Issued in October 2014

NBER Program(s):Economic Fluctuations and Growth, Labor Studies, Public Economics



The Affordable Care Act introduces or expands taxes on incomes and full-time employment, beginning in 2014. The purpose of this paper is to characterize the new full-time employment taxes from the perspective of a household budget constraint, measure their magnitude, and assess their likely consequences for employee work schedules. When the ACA is fully implemented, full-time employment taxes will be prevalent and often as large as what workers can earn in five hours of work per week, 52 weeks per year. The economic significance of the ACA's full-time employment taxes varies by demographic group: they are non-monotonic in age, increasing with family size, and negatively correlated with schooling.

Acknowledgments

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Document Object Identifier (DOI): 10.3386/w20580

Published: The New Full-time Employment Taxes, Casey B. Mulligan. in Tax Policy and the Economy, Volume 29, Brown. 2015

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