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For all of you who put off filing your taxes until the last minute ( myself included ) you have today left to get with the program. Today, Monday, April 18, is the last day to get that return postmarked.
Speaking of taxes. Why don’t we take a look at how much of a tax break those really wealthy folks have received over the years?
The Internal Revenue Service tracks the tax returns with the 400 highest adjusted gross incomes each year. The average income on those returns in 2007, the latest year for IRS data, was nearly $345 million. Their average federal income tax rate was 17 percent, down from 26 percent in 1992.
Over the same period, the average federal income tax rate for all taxpayers declined to 9.3 percent from 9.9 percent.
The top income tax rate is 35 percent, so how can people who make so much pay so little in taxes? The nation's tax laws are packed with breaks for people at every income level. There are breaks for having children, paying a mortgage, going to college, and even for paying other taxes. Plus, the top rate on capital gains is only 15 percent.
There are so many breaks that 45 percent of U.S. households will pay no federal income tax for 2010, according to estimates by the Tax Policy Center, a Washington think tank.
Both side of the money equation are pretty much paying nothing or close to it in federal taxes. Is it any wonder that the United States government has a deficit problem? The sad thing is that the wealthy, when they do owe some tax cash, are paying no more in many cases than someone making less than $50,00 per year. That is not right.
More than half of the nation's tax revenue came from the top 10 percent of earners in 2007. More than 44 percent came from the top 5 percent. Still, the wealthy have access to much more lucrative tax breaks than people with lower incomes.
Drop the Bush/Obama tax cuts, get rid of the loopholes for the wealthy and a few of the credits for the average payer, and then the budget deficit starts to get smaller.
Deficit? What deficit?
