Buildings on Wall Street/ Little Larry flickr
By Ben West-Weyner
This year was my first time filing my own income taxes, and I was happy to be eligible for a tax credit due to my tuition payments. However, the experience left me curious as to what this process looks like for the more wealthy.
According to our tax code, individual Americans who earn more than $400,000 in a year are supposed to pay 39.6% of their income in taxes. In 2009, the richest 400 individual taxpayers on average paid less than 20 percent of their earnings to the government. Compare this with the fact that individual taxpayers that same year earning between $33,951 and $82,250 were asked to pay 25% in taxes.
Corporations and the most wealthy have found a way to pay taxes on a regressive scale (the more you earn, the smaller percentage paid) within our existing progressive tax structure. But how?
For more on how loopholes impact both federal spending and the deficit, check out NPP's most recent "Big Money in Tax Breaks" report. If you’re interested in how our representatives in Washington plan to modify current tax policy, check out this easy to digest breakdown of three federal budget proposals. To really visualize the effect of these tax breaks, check out this interactive graphic.