The Pankian Metaphor 3045

there is the periodic line about numbers being made to lie. statements about tax reform benefit the "rich" ... frequently is because the "rich" are the ones paying the taxes.

So here is fairly representative analysis, "Tax Distribution Analysis and Shares of Taxes Paid - Updated Analysis"

Distribution is shown in two ways ... the distribution of percent of taxes paid as a function of income (doesn't differentiate whether this is gross income or net income ... although a lot of news recently is about how AMT rules are catching more and more). The other distribution is the percent of total federal taxes paid as a function of income.

in any case, recent data from the above report:

IRS data for 2003, the most recent available, show that the top half of taxpayers ranked by income continue to pay over 96 percent of Federal individual income taxes while the bottom half accounts for just less than 3.5 percent. The data show the highly progressive nature of the Federal income tax.

The top one percent of tax filers paid 34.27 percent of Federal personal income taxes in 2003, while the top ten percent accounted for 65.84 percent of these taxes. To be counted in the top one percent taxpayers needed Adjusted Gross Income (AGI) of $295,495 or more. The 2003 AGI cut-off amount for the top ten percent is $94,891, while the cut-off amount for the top-bottom fifty percent is $29,019.

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also, table from the same report ... doesn't do further break out of bottom 50 percent ... so doesn't show any actual data about bottom 25 percent actually having negative tax (just that the bottom 50 percent paid only 3.46 percent of the total federal income tax paid).

from above:

Percentials ranked AGI Threshhold Percentage of by AGI on Percentiles Fed. personal income tax paid Top 1% $295,495 34.27% Top 5% $130,080 54.36% Top 10% $94,891 65.84% Top 25% $57,343 83.88% Top 50% $29,019 96.54%

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Of course, the above doesn't show situations where gross income is significantly larger than adjusted gross income. However, with the top ten percent (of the population by AGI) paying over half of total Fed. personal income tax paid (65.84percent), then any personal income tax reform is likely to affect them much more than the bottom half of the population (by AGI), which accounts for only a total of 3.46percent of total Fed. personal income tax paid.

Conversely, for a category (bottom 50percent) that is already paying extremely little of the total federal personal income tax (3.46percent), then any change isn't likely to have much effect on them. If you are already close to paying zero of the total federal personal income tax, it is hard to have you pay less than zero (modulo using income tax refunds as mechanism for low-income social payments method and referring to them as negative income tax, verging on one of those 1984 scenarios changing what words mean).

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