The IRS recently released preliminary data for Tax Year 2014. The data shows that the U.S. income tax system remains very progressive, with high-income taxpayers paying a disproportionate share of the tax burden relative to their share of the nation’s income, while the majority of taxpayers pay a considerably smaller share relative to their share of total income.
Overall, nearly 149 million taxpayers filed a tax return in 2014. After adjusting for credits and deductions, 52 million filers (35 percent of the total) had no income tax liability, while the remaining 97 million filers paid nearly $1.3 trillion in income taxes.
As my colleague Scott Greenberg wrote last week, in 2014, America’s income tax bill grew by more than 10 percent over 2013, far surpassing the 6 percent growth in incomes. This is a clear indication that the tax code is rigged to insure that tax revenues outpace the growth in the economy.
Much of the growth in income tax payments was generated by taxpayers at the top of the income scale. In 2013, taxpayers earning over $250,000 paid $603 billion in income taxes. By contrast, in 2014, these taxpayers paid $700 billion in income taxes, 16 percent more than 2013.