Paul L. CaronDean
Monday, December 7, 2009
By Paul Caron
Following up on my post last month on the Fall 2009 Statistics of Income Bulletin, which included the article, Individual Income Tax Returns, 2007: Martin Sullivan today tracks the declining U.S. tax rate on millionaires:
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A millionaire is someone with a net worth of $1M of more, which is not the same as someone who earns $1M.
Posted by: save_the_rustbelt | Dec 7, 2009 1:19:10 PM
But, a million dollars doesn't get you as far today as it used to.
Posted by: Woody | Dec 7, 2009 2:29:24 PM
Here's what I posted at tax.com:
The $1M threshold does not appear to be adjusted for inflation in this report. Therefore a slow downward trend in tax rate is normal, as more of the no-as-rich (who should have lower average tax rates) enter the club each year.
To make this easy to see, imagine this analysis continuing 100 years, at which point most taxpayers will have incomes exceeding $1M in current dollars. Then the average tax rate for millionaires will be the average tax rate for everyone.
Posted by: AMTbuff | Dec 7, 2009 6:13:03 PM
Were tax free investments adjusted for the imputed taxes hidden by their lower yields?
Posted by: Steve Karpa | Dec 8, 2009 5:42:34 AM
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