New CBO study shows who pays the most taxes and who gets the most out of it

Looks like the Congressional Budget Office has come up with some alarming data about just who pays the biggest chunk of taxes and who gets the lump sum advantages.

The "Rich" pay by far the most and get the least back.

Such imbalances will certainly lead to massive tax protests in the near future.

So who says "Thank You" now?

Lots of tables and charts and links to study ....

The Congressional Budget Office (CBO) just released its annual report on “The Distribution of Household Income and Federal Taxes” analyzing data through 2011 on American household’s:

a) average “market income” (a comprehensive measure that includes labor income, business income, and income from capital gains),

b) average household transfer payments (payments and benefits from federal, state and local governments including Social Security, Medicare and unemployment insurance),

and c) average federal taxes paid by households (including income, payroll, corporate, and excise taxes). Some of the key findings of the CBO analysis are displayed in the table above, with the data organized by household income quintiles. The data in the first five rows above appear in the CBO report (from Tables 1 and 4), and rows 6-8 above have been calculated separately based on data from the first four rows in the table.


New CBO study shows that ‘the rich’ don’t just pay their ‘fair share,’ they pay almost everybody’s share

Who's Running this Anyway?

a reply to: xuenchen

This Does come from the Congressional Budget Office.
I am sure they Know who Pays for them To be in Office
That would be the Rich and Corporations,, so I think they are
Getting ALL of the Benefits they Want and Pay for thru Lobby, not as stated the Least.

I Call BS.

a reply to: EarthCitizen23

But it's official government published.

a reply to: xuenchen

This doesn't actually take into account all of the real ways our taxes subsidize the wealthy. How about bailouts, industry subsidies, and the general infrastructure that's provided so they have a place they are allowed to exploit people in?

To any obscenely wealthy person who complains about paying "more than their fair share", I say move. Move to Somalia where you can exploit all you want and pay nearly nothing in taxes. There is a reason they won't make that move. It is because no matter how high we hike their taxes up, they are still making a killing, especially since most of those tax dollars go right back into their pockets, even if inadvertently.

For example, if you are paying minimum wage and your employees are getting government assistance, that's our tax dollars subsidizing your work force! There are countless examples of how our wealthiest are the biggest welfare recipients in our nation. There is much more to this than a cursory glance at raw numbers.

a reply to: Cuervo

Comparing those numbers would be interesting.

I'm in Quintile 4 and I have no idea what the government is providing me that could negate my income. The article says I would get $14,100 back in "transfer payments". What in the?? I'll take a check please. Everything I do and buy and earn is taxed out the wazoo.

Wow. That IS an eye-opener. So the top quintile, the people who account for 85% of the total wealth of the country pay 69% of the country's taxes. What a travesty! Get out the pitchforks and torches! Burn the poor! Why, those lousy free-loaders, the other 80% of us have 15% of the country's entire wealth and they're only paying 31% of the country's taxes. The fricking nerve!!

originally posted by: jjkenobi
I'm in Quintile 4 and I have no idea what the government is providing me that could negate my income. The article says I would get $14,100 back in "transfer payments". What in the?? I'll take a check please. Everything I do and buy and earn is taxed out the wazoo.

Do you think you work harder than the single mother who raises her child and works full-time waiting tables? Do you have to choose between health and affordability when picking out your family's food? Do you have to borrow money in order to pay for basic utilities during the winter time? Do you have to keep saying "maybe next year" when you realize you can't afford to take even one week off for a road trip (let alone flying somewhere)? Can you actually afford to go to the doctor?

When I think I'm paying too much in taxes, I run those questions through my head and then happily file my tax forms realizing I still have it better than most and that 10% of a minimum wage employee's check is faaaar more impacting to that person's life than 40% of my check is to mine.

In this country, paying a crap ton in taxes is a problem most poor people would like to have.

Everybody is complaining about who pays what in taxes and forgets that taxes are not the problem. Our government has a spending problem not an income problem.

a reply to: xuenchen

Did the CBO take into account all the wars that their tax dollars subsidize, and what they typically gain from those wars?

Hint: "Record profits" is not something typically uttered during peacetime.

Not to say that we need to redistribute wealth, or anything else stupid like that. Only that the CBO has invoked the "Figures don't lie, but liars can figure" clause.

originally posted by: EarthCitizen23
a reply to: xuenchen

This Does come from the Congressional Budget Office.
I am sure they Know who Pays for them To be in Office
That would be the Rich and Corporations,, so I think they are
Getting ALL of the Benefits they Want and Pay for thru Lobby, not as stated the Least.

I Call BS.

I'll be willing to bet the Middle Class paid a heck of a lot more before their jobs were shipped out of the country as well.
Its simple logic that the ones with the most wealth are going to be also paying the most taxes.

They want to own the government and not have skin in the game is basically what it comes down and pay less as a percent then the rest.
Don't like it? Give the government back to the people.

I like how the article tries to make a simple black and white explanation of those 'poor' one-percenters and the amount they pay in taxes.

The American Enterprise Institute is a community of scholars and supporters committed to expanding liberty, increasing individual opportunity and strengthening free enterprise.

Well...that sure sounds like a group looking out for the working class, doesn't it? But let's look at the article for a second:

Some additional analysis and commentary will be provided here that reveal a yet-to-be discussed major implication of the CBO report – almost the entire burden: a) of all transfer payments made to American households and b) of all non-financed government spending, falls on just one group of Americans – the top one-fifth of US households by income.

Ah...you read that line in the middle there, "the burden." Those burdensome taxes holding the wealthiest among us back...if only they had less of a burden they'd be able to...make more money? If you're in that top quintile (more than $234,700 annual income) then you're the victim here! You're burdened by these taxes!

Here’s another way to think about the burden of the “net payer” top income quintile. The average household in that income quintile made a contribution net of transfers in 2011 in the amount of $46,500.

They made so much money that they had to pay the average American salary in taxes. Woe be to the rich, for they have paid dearly for food stamps.

What's very telling about this is that the top 1% have made so much more money than the rest of us that they alone make up nearly a quarter of all the income for the highest 20%. The top 1% made 46% of all the income in America. All of it. In addition to nearly 60% of all market income. That's just the one percent. They've made so much money that, while they're included in the highest quintile, they are regularly referred to as a group of their own throughout the entire report.

Not only are 'the rich' making more money than the rest of us, but they're making all the money. The economy is great...if you're in the top 20% of income 'earners' in the country.

So no, I'm not going to lose sleep, cry a tear or light a candle for those rich bastards. To think that they have the gall to insist they're taxed 'too much' already. They make leaps and bounds more than most of us will ever see in a lifetime...I expect them to pay more. So long as there's a homeless family and an empty house in the same zipcode, I expect them to pay a lot more than they do already.

For those of you who like graphs, here's the CBO report.

originally posted by: xuenchen
Looks like the Congressional Budget Office has come up with some alarming data about just who pays the biggest chunk of taxes and who gets the lump sum advantages.

The "Rich" pay by far the most and get the least back.

Such imbalances will certainly lead to massive tax protests in the near future.

that's the way it is supposed to work! D

a reply to: xuenchen

All I know is that if I make $50,000 in a year. My tax rate is about 25% on my income, but not only does the Federal government tax me, my state wants a 7% cut as well (and this isn't even counting local and county government taxes). So that leaves me $33,000. Then add in a 7% sales tax on everything I purchase with my 33k and I effectively have $31,000 of purchasing power. That isn't too bad but I've paid $19,000 in taxes, or so we think.

The fantasy of the CBO report is that it uses government math. Tell me who pays the taxes of corporations? Its not the corporation, its the consumer. The corporation just passes its tax burden off to the customer. That's me! I use my $31,000 to buy from a corporation and pay their taxes for them on a product that could be much cheaper if they were not taxed. The real winners, or those that receive government contracts in the billions of dollars each year. Research, pharmaceuticals, planes manufacturers and basically everyone who works for or contracted with the government, which if I remember is a good portion of the economic activity in America. These people, many whom are rich, received their money directly from the tax payer. But this CBO report argues that they pay the most tax? With what taxed monies?

a reply to: ExPostFacto

I don't know if I'd add sales tax into your effective tax rate. Unless you don't buy food or pay rent or pay for utilities or pay for anything else other than what you'd buy in a store.

My tax rate so far this year is 20%. This is including OASDI, federal and local taxes and whatnot. I usually get some money back each year giving me an effective tax rate of about 17%.

If you were to itemize your spending throughout the year and find exactly what you spent on that 7% sales tax you can also write that off. It's things like this that I was referring to when I said 'black and white', there are ways around paying your maximum tax bracket through write-offs. The rich usually pay someone to do their finances so I'm not surprised when the average effective tax rate is well below the maximum 35%.

a reply to: xuenchen

Considering its by the people who make a lot of the money,you can play with numbers to make them look like anything you want. Therefore I'm not going to take this seriously. And really if it is true,then why would they not go with a flat tax rate across the board like people have been wanting for years now? They know all the tax loop holes and play them to the max. Corporations pay little to nothing in some cases.

originally posted by: xuenchen
Looks like the Congressional Budget Office has come up with some alarming data about just who pays the biggest chunk of taxes and who gets the lump sum advantages.

The "Rich" pay by far the most and get the least back.

I am not sure you know how to read the report? From the actual report you linked.

What Are the Trends in the Distribution of Household Income and Federal Taxes?

Over the 33-year period from 1979 to 2011, average after-tax income—which equals market income plus government transfers minus federal taxes—grew at significantly different rates at different points in the income scale.

For households in the top 1 percent of the income distribution, inflation-adjusted after-tax income grew at an estimated average rate of 3.5 percent per year. As a result, inflation-adjusted after-tax income was 200 percent higher in 2011 than it was in 1979 for households in that group.

In contrast, households in the bottom quintile experienced inflation-adjusted after-tax income growth of 1.2 percent per year, on average. Consequently, inflation-adjusted after-tax income was 48 percent higher in 2011 than it was in 1979 for that income group.

Those differences in growth rates for after-tax income are largely attributable to differences in growth rates for market income, although changes in taxes and transfers played a role as well.

Wow...that is the actual report you cited!

Even adjusting for inflation...the top 1% is taking home...after taxes 200% more in real dollars than they were in 1979..

While the bottom 20% has only grown by 43% in after taxes take home.

Why?..."largely attributable to differences in growth rates for market income, although changes in taxes and transfers played a role as well"

Stock investments and tax breaks.

This report clearly shows the continuing trend of the rich getting richer and the poor getting poorer.

a reply to: Indigo5



I told ya the data was alarming.

originally posted by: xuenchen
a reply to: EarthCitizen23

But it's official government published.

you are using the classic republican take on taxes...of course they pay the most in aggregate, but not as a % of total income, that's because they have made the majority of income....work from the percentage side rather than overall numerical amount....if I made 50 thousand and paid 20% in taxes i would pay 10 thousand....if i made 5 million and paid 20% in taxes I would pay 1 million.....10,000 dollars versus 1,000,000 dollars...gee, guess who paid more in taxes!!!....and yet, we paid the same percentage of taxes

a reply to: jimmyx

The poorest in America don't pay taxes. Instead, they realize income that amounts to a redistribution of wealth (all those EIC's).

When you talk about tax burden you are talking about the middle class vs the wealthy. Taxes hit the middle class first and hardest. The middle class is the lowest class actually paying taxes.