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View Full Version : 45% of Americans pay no federal income tax



Teh One Who Knocks
02-25-2016, 02:44 PM
By Catey Hill - Market Watch


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Many Americans don’t have to worry about giving Uncle Sam part of their hard-earned cash for their income taxes this year.

An estimated 45.3% of American households — roughly 77.5 million — will pay no federal individual income tax, according to data for the 2015 tax year from the Tax Policy Center, a nonpartisan Washington-based research group.

Roughly half pay no federal income tax because they have no taxable income, and the other roughly half get enough tax breaks to erase their tax liability, explains Roberton Williams, a senior fellow at the Tax Policy Center.

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Despite the fact that rich people paying little in the way of income taxes makes plenty of headlines, this is the exception to the rule: The top 1% of taxpayers pay a higher effective income-tax rate than any other group (around 23%, according to a report released by the Tax Policy Center in 2014) — nearly seven times higher than those in the bottom 50%.

On average, those in the bottom 40% of the income spectrum end up getting money from the government. Meanwhile, the richest 20% of Americans, by far, pay the most in income taxes, forking over nearly 87% of all the income tax collected by Uncle Sam.

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The top 1% of Americans, who have an average income of more than $2.1 million, pay 43.6% of all the federal individual income tax in the U.S.; the top 0.1% — just 115,000 households, whose average income is more than $9.4 million — pay more than 20% of it.

When it comes to all federal taxes — individual income, payroll, excise, corporate income and estate taxes — the distributions of who pays what is more spread out. This is partially because nearly everyone pays excise taxes, which includes taxes on gasoline, alcohol and cigarettes.

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RBP
02-25-2016, 02:50 PM
Not only are those 40% not paying, they are taking tax money out of the system in so-called refundable deductions. That's why you see the negative $600+, because they are still getting tax refunds despite paying nothing in.

Teh One Who Knocks
02-25-2016, 02:57 PM
But...but...but....but....the rich need to pay their fair share!!!!!!!!

RBP
02-25-2016, 03:21 PM
They pay the same effective rate as a low level secretary! :villagers:

Teh One Who Knocks
02-25-2016, 03:36 PM
Warren Buffett said it, so it must be true :thumbsup:

Pony
02-25-2016, 05:35 PM
https://www.youtube.com/watch?v=S6HEH23W_bM