Attempt to resolve bug identified in issue 171

[martinholmer]

@Amy-Xu said during March 2015 in issue #171:

In the original [code] for medical deduction, the floor rate was hard coded as 7.5%. (Later on I parameterized it as ID_medical_frt.) However starting from the beginning of 2013, this rate increases to 10% for most taxpayers and remains as 7.5% for taxpayers or their spouses no younger than 65. http://www.irs.gov/taxtopics/tc502.html

I changed this rate from 7.5% to 10% in this pull request #169 , but have not incorporated the exceptions for elderly taxpayers yet.

Need to find a way to separate taxpayers by the age of 65.

This pull request attempts to fix this bug in a way that requires the least amount of change in Tax-Calculator and TaxBrain. Fixing this bug, as Amy indicated above, increases the number of elderly itemizers, and therefore, slightly reduces aggregate income tax liability in the 2013-2016 period; there is no change for 2017+. The decline in 2016 income tax liability is about $1.1 billion, which is less than 0.08 percent of aggregate income tax liability. This small bug fix also causes changes in some marginal tax rates and in some reform comparison results.

@MattHJensen @Amy-Xu @feenberg @GoFroggyRun @zrisher

[codecov-io]

Current coverage is 98.08% (diff: 100%)

Merging #839 into master will not change coverage

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[Amy-Xu]

I guess I'm a bit confused here. So after 2016, there's no rate add-on anymore?

[martinholmer]

@Amy-Xu said:

I guess I'm a bit confused here. So after 2016, there's no rate add-on anymore?

My understanding of the IRS document you cited is that the add-on becomes zero beginning in 2017. That is, the floor becomes 10% of AGI for everybody beginning in 2017. Did I misunderstand current-law policy or did I specify it incorrectly in the current_law_policy.json file?

[martinholmer]

Unless there are other questions, comments, or concerns regarding Tax-Calculator pull request #839, it will be merged into the master branch sometime after the end of the day on Wednesday, July 27th.

@MattHJensen @Amy-Xu @feenberg @GoFroggyRun @zrisher

[Amy-Xu]

@martinholmer You're right on that parameter. This PR looks good to me!