How You Rank as a Taxpayer

Tax Breaks

Where You Rank as a Taxpayer

Do the rich pay their fair share of taxes? How about you? Our handy tool will help you answer these questions.

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You'll be hearing a lot about tax inequality during the 2020 presidential campaign season. All the Democrats seeking their party's nomination are talking about taxing the rich more heavily. There's no shortage of proposals to impose "wealth taxes," raise the top income tax rate, increase estate taxes, and eliminate tax breaks for the wealthy. On the other side, President Trump will point to those parts of the 2017 tax reform law that help many middle- and lower-income taxpayers, such as supersizing the standard deduction, doubling the child tax credit, and lowering rates across the board. Before casting your ballot, you'll have to decide for yourself if our tax system is "fair" and whether some groups should pay more (or less) in taxes.

SEE ALSO: Tax Plans for All the Democratic Presidential Candidates

Then there's your own situation. No matter how "rich" or "poor" or "middle class" you are, are you bearing your "fair share" of the nation's tax burden? Do you have the faintest idea what portion you pay ... beyond a gnawing feeling that it's too darn much?

To help answer your questions about tax equality, we created a tool to show how the nation's taxable income and the country's federal income tax bill are distributed among its citizens. Our tool uses the latest IRS data to shine a bright light into what are too often murky shadows.

We'll also show you how your own income stacks up against that of your fellow Americans.

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Are you ready to see where you fit in? With our simple calculator, enter a single number from your tax return, and you'll instantly know the answer.

A look at the big picture

The latest numbers from the IRS—based on data from 2017 tax returns—show what it takes to be among the top 1% of income earners: At least $515,371 of adjusted gross income. That's $34,567 more than it took to buy into this rarified status a year earlier. The 1.4 million returns reporting this elite income status accounted for 21% of the total adjusted gross income reported on 2017 returns.

SEE ALSO: 20 Most-Overlooked Tax Breaks and Deductions

That's right. One percent of taxpayers reported about one-fifth of all income. And that same tiny group kicked in more than 38% of all the federal income taxes paid.

How much do you need to make to be in the top 50% of earners? Just $41,740.

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Fall below that level, and you are in the bottom half, along with about 71 million of your fellow taxpayers. All told, that group earned just 11.3% of the AGI reported on 2017 federal returns. And they paid about 3% of all the income taxes paid.

Use our calculator to see if you're in the top 1%, 5%, 10%, 25% or 50% . . . or the bottom 50% of income earners.

Our income and tax-burden breakdowns come from information reported on 2017 individual income tax returns. Income categories are based on adjusted gross income, which is basically income from taxable sources minus certain deductions—including deductible contributions to IRAs, alimony paid and student loan interest—but before subtracting the value of exemptions (before the 2018 tax year) and either the standard or itemized deduction.

Income Category 2017 AGI Percent of All Income Percent of Income Taxes Paid
Top 1% Over $515,371 21.0% 38.5%
Top 5% Over $208,053 36.5% 59.1%
Top 10% Over $145,135 47.7% 70.1%
Top 25% Over $83,682 69.1% 86.1%
Top 50% Over $41,740 88.8% 96.9%
Bottom 50% Below $41,740 11.3% 3.1%

Source: Internal Revenue Service data

(Note that these figures include only federal income taxes. According to Treasury Department estimates, most wage earners will pay more in payroll taxes—Social Security, Medicare and unemployment taxes—than they do in income taxes.)

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