Day 5 of 28 Days of Tax Data
From Mint
There is a lot going on in this graphic. First, keep in mind that a “Tax unit” is either a single person, two people married filling jointly, or head of household (for example a single person with dependent child).
The gray dashed bars are the tax units that don’t owe any taxes to the Federal Government. What struck me was that these people can be found at all income levels.
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So, people who make less than $10k a year pay 99.8% of all income taxes? There is an awful lot going on in this graph, and it has made it confusing. I think it must be additive, that people who make less than $10k/year AND everyone who makes more than $10k/year pay 99.8% of all income taxes. But that’s everyone, so who pays the other .2%?
Saul: I agree with you that the chart is really busy. It took me a bit of study to get it. People in the 10k group do not pay taxes on 99.8% of their income. The bottom earning 50% of the population pays 2.9% of all income tax. Does that one example make it clearer?
Very nice chart… But you wonder how someone earning $200K would pay no income taxes? Could they be living off tax-free munis?
Saul you miss the graph’s point – 99.8% of the people earning less than $10,000 a year do not pay taxes; likewise 21.5% of the folks making between $50,000 and $75,000 DO NOT pay any taxes. Conversely, about 60% of the US tax burden is paid by the wealthiest 5% of the population. The so-called middle class who think they pay too much tax, only contribute 10% or more to the pot (depending on what income bracket you want to include as middle class). That is all assuming I read the chart correctly.