Friday, December 28, 2012

The 46%

One of my political talking points sources brought up the 46% of Americans don't pay federal income taxes. This number or similar numbers came up during the just completed election cycle. It's worthwhile perhaps looking at just who are the 46% who don't owe federal income tax. I should add that before the Great Recession the number was 40%.

So of the 46%, 61% are working poor that do not earn enough to owe federal income tax. 22% are poor elderly that again do not earn enough to owe any federal income tax. Working poor that are paying pay roll taxes, Social Security taxes, and medical taxes as well as state and local taxes. The other non owers of federal income taxes are as noted in the above chart. I will only add that I know a few folks that will likely never owe federal income tax and they really do need help.

In following the fiscal cliff (I prefer Austerity Bomb) more closely than is good for me, I do hope that policy makers remember that most of the 46% are working poor or elderly poor. Punishing them for not making enough money may very well be counter productive.


Ryan M. Ferris said...

The fact that 46% of households don't pay income tax is devastating enumeration of the failure of the current capitalist class to create a working economy. A society of well-unionized working class will make enough wages to support the government services their families need and use. There are, of course, an elite group of investment class households who have probably figured out how to offshore, evade, use federal subsidies or create other tax shelters with such alacrity that they are received a net return from the federal government.

susan said...

You know who else don't pay taxes? The non-working rich. Oh, those who don't pay clever tax lawyers, maybe they pay 15% on their un-earned income.