Average Income in 2006 up $60,000 for Top 1 Percent of Households, Just $430 for Bottom 90 Percent: Income Concentration at Highest Level Since 1928, New Analysis Shows
 Piketty and Saez rely on detailed Internal Revenue Service micro-files for most years, but use more aggregated IRS data and statistical techniques to extend their series back to 1913. Their July 2008 revision incorporates the detailed micro-files for 2006 that just became available to update their earlier preliminary estimates for 2006. For details on their methods, see Thomas Piketty and Emmanuel Saez, “Income Inequality in the United States: 1913-1998,” Quarterly Journal of Economics, February 2003, or, for a less technical summary, see http://elsa.berkeley.edu/~saez/saez-UStopincomes-2006prel.pdf. Their most recent estimates are available at http://elsa.berkeley.edu/~saez/TabFig2006.xls.
 Piketty and Saez present three different data series, each of which uses a different income concept, and therefore yields somewhat different estimates of the share of income going to each group. (For example, estimates of the share of income going to the top 1 percent in 2006 range from 17.98 percent in one series to 20.02 percent in the series we rely on here to 22.82 percent in the third series.) We focus on the series that includes capital gains income in measuring the income households receive, but ranks households according to their non-capital gains income. The authors indicate that this approach to sorting households gets around the volatility associated with capital gains realizations and provides a better measure of the underlying distribution of income than a measure that sorts households according to income including capital gains. But the authors also present a data series that includes capital gains income and ranks households by income including capital gains, as well as a series that excludes capital gains altogether. In 2006, under both income concepts that include capital gains income, the share of income flowing to the top 1 percent was at its highest level since 1928. Under the income concept that excludes capital gains, the income share going to the top 1 percent was at the highest level since 1929.
 Different data series show modestly larger or smaller gains for the bottom 90 percent, but all series show a similar discrepancy between the bottom 90 percent and the top 1 percent.