Who Pays Income Taxes

Who Pays Income Taxes

The income tax burden on higher-income tax filers has gone up, according to IRS statistics.  The top 1% of individual filers paid 39.5% of all federal income taxes in 2014, the most recent year the Revenue Service has analyzed.  That’s up from 37.8% in 2013.  Higher-income tax filers also reported 20.6% of total adjusted gross income, also an increase from the prior year.  Tax filers with adjusted gross income (AGI) of at least $465,626 qualify as the top 1% of earners.

The top 5% of tax filers paid 59.97% of total federal income tax and accounted for 35.96% of all adjusted gross income.  They each had AGI of at least $188,996.  The top 10% of tax filers, those with AGIs of $133,445 or more, accounted for 70.9% of the total federal tax burden while earning approximately 47.2% of individuals’ total adjusted gross income.

The bottom 50% of tax filers paid only 2.75% of the total federal income tax in 2014.  While this percentage is low, it is important to note that these income tax statistics do not consider social security contributions, sales tax, and other taxes and fees that are regressive in nature and thus may pose a greater burden to lower income tax filers.