Income Transfers, Taxes, and the Poor

While government income transfer programs reduced or eliminated poverty for some benefit recipients, 10 percent of the U.S. population remained in poverty after all transfers were made in 1983. In nonmetro America, the 1983 poverty rate was 12.8 percent. Moreover, many of these poor were working poor, and taxes reduced their earnings. The nonmetro working poor will benefit from recent tax reform that lessens their tax burden.