The Average U.S. Worker Pays over $16,000 in Income and Payroll Taxes

June 23, 2014

The average U.S. worker faces a tax burden of 31.3 percent. This includes both income taxes and payrolls taxes. Between these two types of taxes, the average U.S. workers pays over $16,000 in taxes on their labor.

The tax burden is a combination of income taxes at the federal, state, and local levels as well as the employee and the employer payroll taxes. Of the 31.3 percent tax burden, 15.4 percent is due to income taxes and 15.9 percent is due to payroll taxes, over half of which is paid by the employer on the employee’s behalf. (Workers pay the cost of the employer-side payroll taxes through lower wages.)

In total, the average worker pays $8,196 in income taxes and $8,462 in payroll taxes, which are meant to fund programs such as Social Security and Medicare.

In the absence of the $16,658 in taxes and any benefits they provide, the average worker would take home $53,223 in income, as opposed to the current after-tax income of $36,564 for the average worker.

To read more about the tax burden on U.S. labor as well as an international comparison, see here.


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