The Truth About the Wealthy and Whether They Are Paying Their Fair Share of Taxes

Every year, especially at national election time 

and at tax time (April 15) there are arguments

as to who pays their fair share of U.S. income

taxes, who should pay more, and who should 

pay less. Politicians run on the topic, some 

in the first camp, others in the second. 

And there are others in the battle as well: 

advocates for this program or that cause,

this ideology or that, this presidential candidate

or that, all of them claiming that they require 

more and more money from Washington 

and/or the state legislatures and/or the  

municipal governments, not to mention

those of the counties.

A popular cry from those with left-wing tendencies 

is "Tax the rich! They don't pay their fair share!"

They don't think that the wealthier among us pay 

enough in income taxes, that they get off easy with 

their taxes somehow. Well, your diligent Peasant did 

some research on the matter and here are my findings:

Data from the IRS (no less!):

*In 2021, the most recent year for these records, taxpayers

filed 153.6 million tax returns, reporting over $14.7 trillion

in individual income taxes. The average income tax rate for 

2021 was 14.9%. The top 1% of taxpayers paid a 25.9 %

rate, nearly eight times higher than the 3.3% average rate

paid by the bottom half of all taxpayers.

*The top 1 per cent's  income share rose from 22.2 % in 2020

to 26.3% while its share of federal income taxes paid rose from

42.3% to 45.8%. 

*The top 50% of all taxpayers paid 97.7% (!) of all federal 

income taxes, while the bottom 50% paid all of just 2.3%.

*The 2021 figures include COVID-19 pandemic-related items 

from the ARPA (American Rescue Plan Act), i.e. the 

non-refundable part of the third round of the Recovery Rebates,

the expanded child tax credit, and the Earned Income Tax Credit.

*Also noted is the fact that Capital gains realizations topped 

$2 trillion to achieve a 40-year high, driving income growth 

and taxes paid for high income groups, i.e. the top 1%.

Shares of total 2021 income tax paid, from the top earners (1%)

to the bottom earners (50%). Quite a find.

Top 1%: 45.8%. That's nearly half of all income taxes paid, and by

just one per cent of the income earners in the United States.

Top 5%: 65.6%.

Top 10%: 75.8%.

Top 25%: 89.2%.

Top 50%: 97.7%.

Bottom 50%: 2.3%.

All Taxpayers: 100%.

But there's more: Some people want to see the higher earners not only

pay still more in income taxes; what do they, pray tell, consider their 

"fair share" of income taxes to pay? But U.S. Sen. Elizabeth Warren

(D-MA) wants to tax the unrealized profits of their investment 

portfolios (!!). This means that if you have, say, stocks and you 

have not sold any of  your shares for a gain, you must STILL pay a 

percentage of your portfolio's worth in taxes! And there a few more

politicians like Sen. Warren in Washington with this same socialistic 

idea in mind! Then these same people call these high earners "greedy"!

Meanwhile, Uncle Sam keeps spending more and more on programs 

that either should not require, and certainly not receive so much money

in order to operate or on programs which should not even exist, as they

are wasteful boondoggles to begin with. So who, then, are the greedy 

ones? 

Keep these facts and figures in mind on this, here at the annual tax

deadline, as well as when you get into an argument with an advocate

for ever more confiscatory taxes including to the point of taking away

investment gains unrealized EVEN THOUGH THEY HAVEN'T BEEN

SOLD YET (emphasis your exasperated Peasant's)! 

Have a Happy Tax Day!

MEM