Following up on my previous post, Income Inequality Decreased Significantly in 2013: Tax Foundation, Summary of the Latest Federal Income Tax Data, 2015 Update:
The Internal Revenue Service has recently released new data on individual income taxes for calendar year 2013, showing the number of taxpayers, adjusted gross income, and income tax shares by income percentiles. The data demonstrates that the U.S. individual income tax continues to be progressive, borne mainly by the highest income earners. ...
High-Income Americans Paid the Majority of Federal Taxes
In 2013, the bottom 50 percent of taxpayers (those with AGIs below $36,841) earned 11.49 percent of total AGI. This group of taxpayers paid approximately $34 billion in taxes, or 2.78 percent of all income taxes in 2013. In contrast, the top 1 percent of all taxpayers (taxpayers with AGIs of $428,713 and above), earned 19.04 percent of all AGI in 2013, but paid 37.80 percent of all federal income taxes.
In 2013, the top 1 percent of taxpayers accounted for more income taxes paid than the bottom 90 percent combined. The top 1 percent of taxpayers paid $465 billion, or 37.80 percent of all income taxes, while the bottom 90 percent paid $372 billion, or 30.20 percent of all income taxes.
High-Income Taxpayers Pay the Highest Average Tax Rates
The 2013 IRS data shows that taxpayers with higher incomes pay much higher average income tax rates than lower-income taxpayers. The bottom 50 percent of taxpayers (taxpayers with AGIs below $36,841) faced an average income tax rate of 3.3 percent. Other taxpayers face much higher rates: for example, taxpayers with AGIs between the 10th and 5th percentile ($127,695 and $179,760) pay an average effective rate of 13.4 percent – four times the rate paid by those in the bottom 50 percent.
The top 1 percent of taxpayers (AGI of $428,713 and above) paid the highest effective income tax rate at 27.1 percent, 8.19 times the rate faced by the bottom 50 percent of taxpayers.
Taxpayers at the very top of the income distribution, the top 0.1 percent (with AGIs over $1.86 million), paid an even higher average tax rate, of 27.9 percent. The average tax rate of the top 1 percent of taxpayers rose significantly in 2013, from 21.9 percent in 2012 to 27.1 percent in 2013.