Nor can the wealth gap be explained by differences in education, because whites have far greater wealth than blacks with the same level of education. Nor is debt an explanation–white families tend to have higher levels of debt than blacks.

The wealth gap has its roots in federal programs like the GI Bill. Black veterans could not use the bill's housing benefits because banks wouldn't issue mortgages in black neighborhoods and because deed covenants and informal racism made the suburbs off-limits to blacks.

The report explains that two households can have the same income, but the one with fewer expenses or with more accumulated wealth from past income or inheritances will have more wealth.

Today, the most important factor in the wealth gap is that white families receive much larger inheritances and other intergeneration transfers than black families.

In addition, data on family incomes does not provide an accurate picture of lifetime income– black families who show a high income in one year are more likely than white families to exhibit a drop in income in subsequent years, and their respective wealth levels reflect this difference, the report states.

A lesser, but notable factor in the wealth gap is that high- and middle-income black families are more likely than white counterparts to be called upon to assist relatives and neighbors.

The report found that white families with high and middle incomes are far wealthier than black families with the same incomes. This is significant because "wealth confers benefits that go beyond those that come with family income," such as preventing a life from being derailed by temporary setbacks and allowing people to take career risks and become entrepreneurs. Family wealth also allows people to access housing in safe neighborhoods with good schools, enhancing the prospects of their own children.

Brookings's ideas on how to narrow the gap include reforms on capital income taxation, a tax on wealth, and taxing inherited income. "Inheritance or estate taxes in particular could enhance equality of opportunity, especially if revenues were invested in programs that give low-income children a better chance at economic success," the report says.

The report was published earlier in 2020 before the coronavirus pandemic worsened and revealed disparities in coronavirus death rates too, as more blacks than whites have died from COVID-19.

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