makes sense since the bottom 40 aren't paying any tax in the first place. i can't believe you sucker for stats like that.
I should know better...
cbpp.org
Considering all taxes — federal, state, and local — the bottom 20 percent of households pays an average of 16 to 17 percent of their incomes in taxes. The next 20 percent of households pays about 21 percent of income in taxes, on average. [21]
In fact, when all taxes are considered, the share of taxes that each fifth of households pays is similar to its share of the nation’s total income. [22] ITEP data show that in 2011, the bottom fifth of households received 3.4 percent of the total income in the nation and paid 2.1 percent of the total taxes. The middle fifth of households received 11.4 percent of income and paid 10.3 percent of taxes. The top 1 percent of households received 21.0 percent of income and paid 21.6 percent of taxes. The tax system as a whole is only mildlyprogressive. [23]
Another Way of Looking at Who Pays No Federal Income Tax A separate TPC analysis categorized people who do not owe federal income tax in 2011 in a different way.* It found that of the filers who don’t owe federal income tax for 2011:
- 50 percent are in this category because their incomes are so low that they are less than the sum of the standard deduction and personal and dependent exemptions for which the household qualifies. As TPC Senior Fellow Roberton Williams has noted, “the basic structure of the income tax simply exempts subsistence levels of income from tax.”** Some 62 percent of the households who will owe no federal income tax in 2011 have incomes under $20,000.
- Another 22 percent do not owe federal income tax because they are elderly people who benefit from tax provisions to aid senior citizens, such as the exemption of Social Security benefits from income tax for beneficiaries who have incomes below $25,000 for single filers and $32,000 for joint filers and the higher standard deduction for the elderly.
- Another 15 percent (of the households who don’t owe federal income tax) don’t owe the tax because they are low-income working families with children who qualify for the child tax credit, the child and dependent care tax credit, and/or the earned income tax credit, and the credit(s) eliminate their income tax liability.***
* Rachel Johnson, James Nunns, Jeffrey Rohaly, Eric Toder, and Roberton Williams, “Why Some Tax Units Pay No Income Tax”, Urban-Brookings Tax Policy Center, July 2011; and Roberton Williams, “Why Do people Pay No Federal Income Tax” TPC TaxVox, July 27, 2011. For a further discussion of this TPC analysis, see Aviva Aron-Dine, “Trends”, Milken Institute Review, First Quarter 2012, pp. 5-11.
** Roberton Williams, “Why Do People Pay No Federal Income Tax?”, TPC TaxVox, July 27, 2011
*** The remainder of those who do not owe federal income tax, about 13 percent, don’t owe federal income tax because of itemized deductions or other tax benefits.
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