In 2020, the coronavirus pandemic and the tax and transfer policies enacted by the federal government in response had significant effects on the distribution of household income. Average income before transfers and taxes decreased by 10 percent for households in the lowest quintile and increased by 6 percent for those in the highest quintile. By contrast, average income after transfers and taxes grew by 15 percent among households in the lowest quintile and by 7 percent among those in the highest quintile. As a result, income inequality before transfers and taxes increased, but inequality after transfers and taxes decreased—to the lowest point since 2009.