33,000 with Income of more than $200,000 Paid No U.S. Income Tax
Nothing’s inevitable except death and taxes, or so the saying goes. Well, about 33,000 well-off Americans have managed to beat the odds on half that adage.
According to a report from the Internal Revenue Service, 32,902 people whose “expanded income” exceeded $200,000 paid no income tax for 2011, the most recent year for which such figures are available. The total amounted to 0.691% of all filers. That’s actually down a bit from the peak of 35,061 such filers, or 0.882%, in the 2009 tax year, before the recession took full hold of the economy. A total of 4.7 million filers in 2011 had incomes of $200,000 or more.
The most common reasons filers escaped having to pay tax was having their income come from tax-exempt sources, such as municipal bonds, or having sufficient medical and dental expenses to offset their income.
Despite the slight drop in the number of high-earners not paying income tax, the number has remained relatively steady since a huge increase in the number in the 2008 tax year. The number of $200,000-plus earners jumped that year to 31,539 from 14,794 the year before.
The IRS began releasing this information in 1977 at the request of Congress.
To Learn More:
New IRS Report Demonstrates yet Another Reason Income Inequality Persists (Citizens for Tax Justice)
Number of High-Income Americans Who Paid No Income Tax Doubled in One Year (by Noel Brinkerhoff and David Wallechinsky, AllGov)
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