Individual Tax Model. They are consistent with a current-law baseline, implying that they assume the expiration in 2012 of recently extended provisions of the 2001 and 2003 tax acts. Those provisions include lower marginal tax rates on ordinary income, preferential tax rates on capital gains and dividend income, an increase in the child tax credit, and marriage penalty relief. a. b. c. d. e. Includes both nonresidential and residential equipment. Includes nonresidential, tenant-occupied, and owner-occupied structures. The economic depreciation rate is set to zero and no tax depreciation is included when calculating effective marginal tax rates for land and inventories. For inventories, the real before-tax rate of return is a weighted average of the cost of capital under last-in-first-out (LIFO) accounting and first-in-first-out (FIFO) accounting. The intangible assets include research and development capital. 23 .