Updated Income Tax Burden breakout

[Brad Johnson]

From the Tax Foundation - Posted September 2006 - An analysis of taxes paid by income bracket compiled directly from the returns for 2004 (the most recent completely closed and reconciled tax year).  I think the last time this was discussed on APS the info was for the 2003 tax year and the 50th percentile split point was somewhere around $57k

http://www.taxfoundation.org/research/show/250.html


The Readers' Digest condensed version. Income split points are based on adjusted gross income.

GROUP
Income split point / Share of total income taxes paid

ALL
----- / 100%

TOP 5%
$137,056 / 57.13%

TOP 25%
$60,041 / 84.86%

TOP 50%
$30,122 / 96.70%

Below 50%
less than $30,122 / 3.3%

Brad

[Northwoods]

Well, at least I know I'm giving a lot more to society than I'm taking.

[ilbob]

obviously, we are not taxing the well to do enough.

[Ben]

The irony is that many of the liberals that yell "tax the rich", if a married couple where both are working, ARE in fact "the rich" in that top 5% when you add both their incomes together.

[Brad Johnson]

The irony is that many of the liberals that yell "tax the rich", if a married couple where both are working, ARE in fact "the rich" in that top 5% when you add both their incomes together.

Sadder still is Joe and Jane Sheeple, parroting what they hear in the media, screaming for the taxation of the "rich" without actually caring to figure they are screaming about taxing ... themselves.

Brad

[Ben]

That's what I was trying to get at, but you said it with more clarity. 

[TarpleyG]

TOP 5%
$137,056 / 57.13%

So this means that if your combined, adjusted gross income is over $137,056, the effective tax rate is almost 43%?  That's absolutely ridiculous.  I really think it is time to reevaluate our tax scam......I mean scheme in this country.

Greg

[Northwoods]

TarpleyG - No.  If you read the whole article you'll see a chart that shows the percentage of each groups' cumulative income that is represented by the same groups cumulative tax payments.  For the top 5% that works out to ~20% IIRC.  'Course for the bottom 50% it works out to ~2%.

[TarpleyG]

Oh, okay...so it's not as bad as it reads...  I usually fall in the 12-15% category.

[Sindawe]

Oh, okay...so it's not as bad as it reads...  I usually fall in the 12-15% category.

Actually, it IS as bad as it reads.  That 12%-15% is just the income portion of the overt taxes.  Don't forget Medicare, SS, State taxes, County taxes, City taxes.  Then add in tax on your car, tax on your phone, tax on your electricity  & gas, tax on your garbage service, tax on EVERYTHING you buy, taxes on the interest you earn for money you save, taxes on real property, taxes on personal property (for those unfortunate enough to live in such a tax happy municipality).

I tallied up all the taxes I paid for one year and calculated that my overall tax rate is > 50% of my income.

[TarpleyG]

I tallied up all the taxes I paid for one year and calculated that my overall tax rate is > 50% of my income.

Oh, I agree with you there because I am in the same boat.  I thought we were strictly speaking about FED WH here...

Greg

[The Rabbi]

The most interesting proposal I have seen about this regards the AMT.  Now the AMT has become a big liberal issue (they passed it to begin with) because voters in blue states have higher incomes generally and are getting caught in it more and more.
The proposal was to eliminate the standard tax regime and keep only the AMT. With its lack of deductions and generally clearer guidelines I think the idea has merit.

[Northwoods]

Rabbi - With some hefty reductions in the rates that might be OK.  Otherwise I'd rather keep the overly complex system currently in place.