Almost half of taxpayers pay no federal income tax, report says

Did you pay any federal income tax from the in 2009. If you did, you’re very close to being in the minority, according to a new report from the Tax Policy Center.

The Associated Press combines that statistic with another report to conclude:

The result is a tax system that exempts almost half the country from paying for programs that benefit everyone, including national defense, public safety, infrastructure and education. It is a system in which the top 10 percent of earners — households making an average of $366,400 in 2006 — paid about 73 percent of the income taxes collected by the federal government.

But the Tax Policy Center says 73% of us pay some form of federal tax, just not income tax.

They pay Social Security and Medicare taxes when they work, sales taxes when they buy things and property taxes on their homes. Drivers pay gasoline taxes, and smokers and drinkers pay excise taxes on tobacco and alcohol.

That includes 99.7 percent of people making over $1 million a year, the group says.

  • teej

    I’m sorry – did I just read that .3% of people who make over $1 million per year pay _no_ federal taxes?

  • Bob Collins

    No, 99.7 % of people making over a million pay some form of federal tax.

  • teej

    Right, that’s what I’m extrapolating from. If only 99.7% of people making over a million pay some form of federal tax, then what’s up with the other .3%? It sounds like they pay no federal taxes.

    Do the reports explain this at all? (lots of deductions, maybe? It sounds a bit like Warren Buffett talking about how his secretary pays more of her income in taxes than he does.

  • John P

    I’m not even close to $366,400, and I definitely pay federal income taxes. I have no dependent children, and no mortgage, so I end up subsidizing those who do. I’m not complaining, I used to have both those things, paid very little in income taxes, and others subsidized me. Now it’s my time to pay back.

  • tripleplay

    Hmmm, two adults – three children – two college loans we are repaying – a mortgage that is very reasonable – and only one of us working the last year. We made 88,000 and owe the feds 1600 and the state 2900….something just hasn’t added up for us year and year out – we always owe no matter how much we have deducted from paychecks or take as deductions.