The Internal Revenue Service has released new data on individual income taxes, reporting on calendar year 2010.[1] As we do every year, we present a summary of that data along with the historical data back to 1980. This year the IRS changed its methodology to exclude dependent filers and include returns with negative AGI. For comparison’s sake, we present this new data as far back as the IRS provides, to 2001, along with the previously reported data for prior years. Here follows the IRS statement regarding this year’s change:
This release including the TaxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities.
Year 2010 percentile data were [sic] produced using an improved methodology to that of previous SOI releases of percentile data in order to refine the accuracy of the percentile estimates. The data in these tables are based on a modified universe of tax returns. In particular, all individual income taxAn individual income tax (or personal income tax) is levied on the wages, salaries, investments, or other forms of income an individual or household earns. The U.S. imposes a progressive income tax where rates increase with income. The Federal Income Tax was established in 1913 with the ratification of the 16th Amendment. Though barely 100 years old, individual income taxes are the largest source of tax revenue in the U.S.
returns except returns of dependents are now used in the computation whereas previous releases were based on only returns with positive AGI. This change was the result of feedback and recommendations made by users of these statistics who encouraged SOI to assess the utility of the information. The data in the improved tables shown here, while more accurate for the dollar amounts shown are still very similar in terms of percentages when compared to the data produced under the previous methodology.[2]
The new methodology results in about 7 to 9 million fewer tax returns in most years but about 5 million fewer returns in 2009 due to the high number of negative AGI returns that year. It also results in a slight overstatement of both the income shares and the average tax rates of the top 1 percent and a slight understatement of the tax shares of the top 1 percent, as compared with the previous methodology.[3]
With that in mind, a few points about the data can be made. First, as a result of the tepid economic recovery, incomes and taxes paid for all income groups increased in 2010 but not to the levels achieved during the boom years of 2006 and 2007.
Second, average tax rates increased in 2010 for all except the top 1 percent, who saw a slight decrease in their average tax rateThe average tax rate is the total tax paid divided by taxable income. While marginal tax rates show the amount of tax paid on the next dollar earned, average tax rates show the overall share of income paid in taxes.
from 24.05 percent of income in 2009 to 23.39 percent in 2010. This is still about 10 times the tax rate of the bottom 50 percent of filers, who paid 2.37 percent of their income in 2010. Tax rates have dropped for all filers since 2001 but have done so most precipitously for low-income filers. The bottom 50 percent of filers paid 4.92 percent of their income in 2001, more than twice the rate they paid in 2010. In contrast, the top 1 percent of filers paid 27.6 percent of their income in 2001, which is about 4 points higher than their 2010 rate.
Finally, as many have noted, incomes have stagnated for low-income households in recent years, but this is true for high-income households as well.[4] In real inflation-adjusted terms, the income thresholds for all percentiles, including the top 50 percent, the top 1 percent, and the top 0.1 percent are lower than they were in 2001 (not shown). That means the nominal income increases since 2001, shown in Table 7, are entirely due to inflationInflation is when the general price of goods and services increases across the economy, reducing the purchasing power of a currency and the value of certain assets. The same paycheck covers less goods, services, and bills. It is sometimes referred to as a “hidden tax,” as it leaves taxpayers less well-off due to higher costs and “bracket creep,” while increasing the government’s spending power.
. In terms of income shares, there has been more growth of income at the top, at least since 2001. The income share of the top 1 percent rebounded slightly to 18.87 percent of income in 2010 after bottoming out in 2009. However, the top share remains lower than it was at any time during the economic expansion of 2004 to 2008.
Table 1. Summary of Federal Income Tax Data, 2010
Number of Returns*
AGI ($ millions)
Income Taxes Paid ($ millions)
Group's Share of Total AGI
Group's Share of Income Taxes
Income Split Point
Average Tax Rate
All Taxpayers
135,033,492
$8,039,779
$949,144
100.0%
100.0%
–
11.81%
Top 1%
1,350,335
$1,517,146
$354,810
18.9%
37.4%
$369,691
23.39%
1-5%
5,401,340
$1,199,053
$205,839
14.9%
21.7%
17.17%
Top 5%
6,751,675
$2,716,199
$560,649
33.8%
59.1%
$161,579
20.64%
5-10%
6,751,674
$915,165
$109,670
11.4%
11.6%
11.98%
Top 10%
13,503,349
$3,631,364
$670,319
45.2%
70.6%
$116,623
18.46%
10-25%
20,255,024
$1,799,588
$156,477
22.4%
16.5%
8.70%
Top 25%
33,758,373
$5,430,952
$826,796
67.6%
87.1%
$69,126
15.22%
25-50%
33,758,373
$1,664,728
$99,986
20.7%
10.5%
6.01%
Top 50%
67,516,746
$7,095,680
$926,782
88.3%
97.6%
$34,338
13.06%
Bottom 50%
67,516,746
$944,099
$22,363
11.7%
2.4%
<$34,338
2.37%
Source: Internal Revenue Service
*Does not include dependent filers.
Table 2. Number of Federal Individual Income Tax Returns Filed 1980-2010 (In thousands)
Year
Total
Top 0.1%
Top 1%
Top 5%
Between 5% & 10%
Top 10%
Between 10% & 25%
Top 25%
Between 25% & 50%
Top 50%
Bottom 50%
1980
93,239
932
4,662
4,662
9,324
13,986
23,310
23,310
46,619
46,619
1981
94,587
946
4,729
4,729
9,459
14,188
23,647
23,647
47,293
47,293
1982
94,426
944
4,721
4,721
9,443
14,164
23,607
23,607
47,213
47,213
1983
95,331
953
4,767
4,767
9,533
14,300
23,833
23,833
47,665
47,665
1984
98,436
984
4,922
4,922
9,844
14,765
24,609
24,609
49,218
49,219
1985
100,625
1,006
5,031
5,031
10,063
15,094
25,156
25,156
50,313
50,313
1986
102,088
1,021
5,104
5,104
10,209
15,313
25,522
25,522
51,044
51,044
Tax Reform Act of 1986 changed the definition of AGI, so data above and below this line not strictly comparable
1987
106,155
1,062
5,308
5,308
10,615
15,923
26,539
26,539
53,077
53,077
1988
108,873
1,089
5,444
5,444
10,887
16,331
27,218
27,218
54,436
54,436
1989
111,313
1,113
5,566
5,566
11,131
16,697
27,828
27,828
55,656
55,656
1990
112,812
1,128
5,641
5,641
11,281
16,922
28,203
28,203
56,406
56,406
1991
113,804
1,138
5,690
5,690
11,380
17,071
28,451
28,451
56,902
56,902
1992
112,653
1,127
5,633
5,633
11,265
16,898
28,163
28,163
56,326
56,326
1993
113,681
1,137
5,684
5,684
11,368
17,052
28,420
28,420
56,841
56,841
1994
114,990
1,150
5,749
5,749
11,499
17,248
28,747
28,747
57,495
57,495
1995
117,274
1,173
5,864
5,864
11,727
17,591
29,319
29,319
58,637
58,637
1996
119,442
1,194
5,972
5,972
11,944
17,916
29,860
29,860
59,721
59,721
1997
121,503
1,215
6,075
6,075
12,150
18,225
30,376
30,376
60,752
60,752
1998
123,776
1,238
6,189
6,189
12,378
18,566
30,944
30,944
61,888
61,888
1999
126,009
1,260
6,300
6,300
12,601
18,901
31,502
31,502
63,004
63,004
2000
128,227
1,282
6,411
6,411
12,823
19,234
32,057
32,057
64,114
64,114
IRS changed methodology, so data above and below this line not strictly comparable
2001
119,371
119
1,194
5,969
5,969
11,937
17,906
29,843
29,843
59,685
59,685
2002
119,851
120
1,199
5,993
5,993
11,985
17,978
29,963
29,963
59,925
59,925
2003
120,759
121
1,208
6,038
6,038
12,076
18,114
30,190
30,190
60,379
60,379
2004
122,510
123
1,225
6,125
6,125
12,251
18,376
30,627
30,627
61,255
61,255
2005
124,673
125
1,247
6,234
6,234
12,467
18,701
31,168
31,168
62,337
62,337
2006
128,441
128
1,284
6,422
6,422
12,844
19,266
32,110
32,110
64,221
64,221
2007
132,655
133
1,327
6,633
6,633
13,265
19,898
33,164
33,164
66,327
66,327
2008
132,892
133
1,329
6,645
6,645
13,289
19,934
33,223
33,223
66,446
66,446
2009
132,620
133
1,326
6,631
6,631
13,262
19,893
33,155
33,155
66,310
66,310
2010
135,033
135
1,350
6,752
6,752
13,503
20,255
33,758
33,758
67,517
67,517
Source: Internal Revenue Service
Table 3. Adjusted Gross Income of Taxpayers in Various Income Brackets, 1980-2010 ($Billions)
Year
Total
Top 0.1%
Top 1%
Top 5%
Between 5% & 10%
Top 10%
Between 10% & 25%
Top 25%
Between 25% & 50%
Top 50%
Bottom 50%
1980
$1,627
$138
$342
$181
$523
$400
$922
$417
$1,339
$288
1981
$1,791
$149
$372
$201
$573
$442
$1,015
$458
$1,473
$318
1982
$1,876
$167
$398
$207
$605
$460
$1,065
$478
$1,544
$332
1983
$1,970
$183
$428
$217
$646
$481
$1,127
$498
$1,625
$344
1984
$2,173
$210
$482
$240
$723
$528
$1,251
$543
$1,794
$379
1985
$2,344
$235
$531
$260
$791
$567
$1,359
$580
$1,939
$405
1986
$2,524
$285
$608
$278
$887
$604
$1,490
$613
$2,104
$421
Tax Reform Act of 1986 changed the definition of AGI, so data above and below this line not strictly comparable
1987
$2,814
$347
$722
$316
$1,038
$671
$1,709
$664
$2,374
$440
1988
$3,124
$474
$891
$342
$1,233
$718
$1,951
$707
$2,658
$466
1989
$3,299
$468
$918
$368
$1,287
$768
$2,054
$751
$2,805
$494
1990
$3,451
$483
$953
$385
$1,338
$806
$2,144
$788
$2,933
$519
1991
$3,516
$457
$943
$400
$1,343
$832
$2,175
$809
$2,984
$532
1992
$3,681
$524
$1,031
$413
$1,444
$856
$2,299
$832
$3,131
$549
1993
$3,776
$521
$1,048
$426
$1,474
$883
$2,358
$854
$3,212
$563
1994
$3,961
$547
$1,103
$449
$1,552
$929
$2,481
$890
$3,371
$590
1995
$4,245
$620
$1,223
$482
$1,705
$985
$2,690
$938
$3,628
$617
1996
$4,591
$737
$1,394
$515
$1,909
$1,043
$2,953
$992
$3,944
$646
1997
$5,023
$873
$1,597
$554
$2,151
$1,116
$3,268
$1,060
$4,328
$695
1998
$5,469
$1,010
$1,797
$597
$2,394
$1,196
$3,590
$1,132
$4,721
$748
1999
$5,909
$1,153
$2,012
$641
$2,653
$1,274
$3,927
$1,199
$5,126
$783
2000
$6,424
$1,337
$2,267
$688
$2,955
$1,358
$4,314
$1,276
$5,590
$834
IRS changed methodology, so data above and below this line not strictly comparable
2001
$6,116
$492
$1,065
$1,934
$666
$2,600
$1,334
$3,933
$1,302
$5,235
$881
2002
$5,982
$421
$960
$1,812
$660
$2,472
$1,339
$3,812
$1,303
$5,115
$867
2003
$6,157
$466
$1,030
$1,908
$679
$2,587
$1,375
$3,962
$1,325
$5,287
$870
2004
$6,735
$615
$1,279
$2,243
$725
$2,968
$1,455
$4,423
$1,403
$5,826
$908
2005
$7,366
$784
$1,561
$2,623
$778
$3,401
$1,540
$4,940
$1,473
$6,413
$953
2006
$7,970
$895
$1,761
$2,918
$841
$3,760
$1,652
$5,412
$1,568
$6,980
$990
2007
$8,622
$1,030
$1,971
$3,223
$905
$4,128
$1,770
$5,898
$1,673
$7,571
$1,051
2008
$8,206
$826
$1,657
$2,868
$905
$3,773
$1,782
$5,555
$1,673
$7,228
$978
2009
$7,579
$602
$1,305
$2,439
$878
$3,317
$1,740
$5,058
$1,620
$6,678
$900
2010
$8,040
$743
$1,517
$2,716
$915
$3,631
$1,800
$5,431
$1,665
$7,096
$944
Source: IRS
Table 4. Total Income Tax after Credits, 1980-2010 ($ Billions)
Year
Total
Top 0.1%
Top 1%
Top 5%
Between 5% & 10%
Top 10%
Between 10% & 25%
Top 25%
Between 25% & 50%
Top 50%
Bottom 50%
1980
$249
$47
$92
$31
$123
$59
$182
$50
$232
$18
1981
$282
$50
$99
$36
$135
$69
$204
$57
$261
$21
1982
$276
$53
$100
$34
$134
$66
$200
$56
$256
$20
1983
$272
$55
$101
$34
$135
$64
$199
$54
$252
$19
1984
$297
$63
$113
$37
$150
$68
$219
$57
$276
$22
1985
$322
$70
$125
$41
$166
$73
$238
$60
$299
$23
1986
$367
$94
$156
$44
$201
$78
$279
$64
$343
$24
Tax Reform Act of 1986 changed the definition of AGI, so data above and below this line not strictly comparable
1987
$369
$92
$160
$46
$205
$79
$284
$63
$347
$22
1988
$413
$114
$188
$48
$236
$85
$321
$68
$389
$24
1989
$433
$109
$190
$51
$241
$93
$334
$73
$408
$25
1990
$447
$112
$195
$52
$248
$97
$344
$77
$421
$26
1991
$448
$111
$194
$56
$250
$96
$347
$77
$424
$25
1992
$476
$131
$218
$58
$276
$97
$374
$78
$452
$24
1993
$503
$146
$238
$60
$298
$101
$399
$80
$479
$24
1994
$535
$154
$254
$64
$318
$108
$425
$84
$509
$25
1995
$588
$178
$288
$70
$357
$115
$473
$88
$561
$27
1996
$658
$213
$335
$76
$411
$124
$535
$95
$630
$28
1997
$727
$241
$377
$82
$460
$134
$594
$102
$696
$31
1998
$788
$274
$425
$88
$513
$139
$652
$103
$755
$33
1999
$877
$317
$486
$97
$583
$150
$733
$109
$842
$35
2000
$981
$367
$554
$106
$660
$164
$824
$118
$942
$38
IRS changed methodology, so data above and below this line not strictly comparable
2001
$885
$139
$294
$462
$101
$564
$158
$722
$120
$842
$43
2002
$794
$120
$263
$420
$93
$513
$143
$657
$104
$761
$33
2003
$746
$115
$251
$399
$85
$484
$133
$617
$98
$715
$30
2004
$829
$142
$301
$467
$91
$558
$137
$695
$102
$797
$32
2005
$932
$176
$361
$549
$98
$647
$145
$793
$106
$898
$33
2006
$1,020
$196
$402
$607
$108
$715
$157
$872
$113
$986
$35
2007
$1,112
$221
$443
$666
$117
$783
$170
$953
$122
$1,075
$37
2008
$1,029
$187
$386
$597
$115
$712
$168
$880
$117
$997
$32
2009
$863
$146
$314
$502
$101
$604
$146
$749
$93
$842
$21
2010
$949
$170
$355
$561
$110
$670
$156
$827
$100
$927
$22
Source: IRS
Table 5. Adjusted Gross Income Shares, 1980-2010 (Percent of total AGI earned by each group)
Year
Total
Top 0.1%
Top 1%
Top 5%
Between 5% & 10%
Top 10%
Between 10% & 25%
Top 25%
Between 25% & 50%
Top 50%
Bottom 50%
1980
100%
8.46%
21.01%
11.12%
32.13%
24.57%
56.70%
25.62%
82.32%
17.68%
1981
100%
8.30%
20.78%
11.20%
31.98%
24.69%
56.67%
25.59%
82.25%
17.75%
1982
100%
8.91%
21.23%
11.03%
32.26%
24.53%
56.79%
25.50%
82.29%
17.71%
1983
100%
9.29%
21.74%
11.04%
32.78%
24.44%
57.22%
25.30%
82.52%
17.48%
1984
100%
9.66%
22.19%
11.06%
33.25%
24.31%
57.56%
25.00%
82.56%
17.44%
1985
100%
10.03%
22.67%
11.10%
33.77%
24.21%
57.97%
24.77%
82.74%
17.26%
1986
100%
11.30%
24.11%
11.02%
35.12%
23.92%
59.04%
24.30%
83.34%
16.66%
Tax Reform Act of 1986 changed the definition of AGI, so data above and below this line not strictly comparable
1987
100%
12.32%
25.67%
11.23%
36.90%
23.85%
60.75%
23.62%
84.37%
15.63%
1988
100%
15.16%
28.51%
10.94%
39.45%
22.99%
62.44%
22.63%
85.07%
14.93%
1989
100%
14.19%
27.84%
11.16%
39.00%
23.28%
62.28%
22.76%
85.04%
14.96%
1990
100%
14.00%
27.62%
11.15%
38.77%
23.36%
62.13%
22.84%
84.97%
15.03%
1991
100%
12.99%
26.83%
11.37%
38.20%
23.65%
61.85%
23.01%
84.87%
15.13%
1992
100%
14.23%
28.01%
11.21%
39.23%
23.25%
62.47%
22.61%
85.08%
14.92%
1993
100%
13.79%
27.76%
11.29%
39.05%
23.40%
62.45%
22.63%
85.08%
14.92%
1994
100%
13.80%
27.85%
11.34%
39.19%
23.45%
62.64%
22.48%
85.11%
14.89%
1995
100%
14.60%
28.81%
11.35%
40.16%
23.21%
63.37%
22.09%
85.46%
14.54%
1996
100%
16.04%
30.36%
11.23%
41.59%
22.73%
64.32%
21.60%
85.92%
14.08%
1997
100%
17.38%
31.79%
11.03%
42.83%
22.22%
65.05%
21.11%
86.16%
13.84%
1998
100%
18.47%
32.85%
10.92%
43.77%
21.87%
65.63%
20.69%
86.33%
13.67%
1999
100%
19.51%
34.04%
10.85%
44.89%
21.57%
66.46%
20.29%
86.75%
13.25%
2000
100%
20.81%
35.30%
10.71%
46.01%
21.15%
67.15%
19.86%
87.01%
12.99%
IRS changed methodology, so data above and below this line not strictly comparable
2001
100%
8.05%
17.41%
31.61%
10.89%
42.50%
21.80%
64.31%
21.29%
85.60%
14.40%
2002
100%
7.04%
16.05%
30.29%
11.04%
41.33%
22.39%
63.71%
21.79%
85.50%
14.50%
2003
100%
7.56%
16.73%
30.99%
11.03%
42.01%
22.33%
64.34%
21.52%
85.87%
14.13%
2004
100%
9.14%
18.99%
33.31%
10.77%
44.07%
21.60%
65.68%
20.83%
86.51%
13.49%
2005
100%
10.64%
21.19%
35.61%
10.56%
46.17%
20.90%
67.07%
19.99%
87.06%
12.94%
2006
100%
11.23%
22.10%
36.62%
10.56%
47.17%
20.73%
67.91%
19.68%
87.58%
12.42%
2007
100%
11.95%
22.86%
37.39%
10.49%
47.88%
20.53%
68.41%
19.40%
87.81%
12.19%
2008
100%
10.06%
20.19%
34.95%
11.03%
45.98%
21.71%
67.69%
20.39%
88.08%
11.92%
2009
100%
7.94%
17.21%
32.18%
11.59%
43.77%
22.96%
66.74%
21.38%
88.12%
11.88%
2010
100%
9.24%
18.87%
33.78%
11.38%
45.17%
22.38%
67.55%
20.71%
88.26%
11.74%
Source: IRS
Table 6. Total Income Tax Shares, 1980-2010 (Percent of federal income tax paid by each group)
Year
Total
Top 0.1%
Top 1%
Top 5%
Between 5% & 10%
Top 10%
Between 10% & 25%
Top 25%
Between 25% & 50%
Top 50%
Bottom 50%
1980
100%
19.05%
36.84%
12.44%
49.28%
23.74%
73.02%
19.93%
92.95%
7.05%
1981
100%
17.58%
35.06%
12.90%
47.96%
24.33%
72.29%
20.26%
92.55%
7.45%
1982
100%
19.03%
36.13%
12.45%
48.59%
23.91%
72.50%
20.15%
92.65%
7.35%
1983
100%
20.32%
37.26%
12.44%
49.71%
23.39%
73.10%
19.73%
92.83%
7.17%
1984
100%
21.12%
37.98%
12.58%
50.56%
22.92%
73.49%
19.16%
92.65%
7.35%
1985
100%
21.81%
38.78%
12.67%
51.46%
22.60%
74.06%
18.77%
92.83%
7.17%
1986
100%
25.75%
42.57%
12.12%
54.69%
21.33%
76.02%
17.52%
93.54%
6.46%
Tax Reform Act of 1986 changed the definition of AGI, so data above and below this line not strictly comparable
1987
100%
24.81%
43.26%
12.35%
55.61%
21.31%
76.92%
17.02%
93.93%
6.07%
1988
100%
27.58%
45.62%
11.66%
57.28%
20.57%
77.84%
16.44%
94.28%
5.72%
1989
100%
25.24%
43.94%
11.85%
55.78%
21.44%
77.22%
16.94%
94.17%
5.83%
1990
100%
25.13%
43.64%
11.73%
55.36%
21.66%
77.02%
17.16%
94.19%
5.81%
1991
100%
24.82%
43.38%
12.45%
55.82%
21.46%
77.29%
17.23%
94.52%
5.48%
1992
100%
27.54%
45.88%
12.12%
58.01%
20.47%
78.48%
16.46%
94.94%
5.06%
1993
100%
29.01%
47.36%
11.88%
59.24%
20.03%
79.27%
15.92%
95.19%
4.81%
1994
100%
28.86%
47.52%
11.93%
59.45%
20.10%
79.55%
15.68%
95.23%
4.77%
1995
100%
30.26%
48.91%
11.84%
60.75%
19.62%
80.36%
15.03%
95.39%
4.61%
1996
100%
32.31%
50.97%
11.54%
62.51%
18.80%
81.32%
14.36%
95.68%
4.32%
1997
100%
33.17%
51.87%
11.33%
63.20%
18.47%
81.67%
14.05%
95.72%
4.28%
1998
100%
34.75%
53.84%
11.20%
65.04%
17.65%
82.69%
13.10%
95.79%
4.21%
1999
100%
36.18%
55.45%
11.00%
66.45%
17.09%
83.54%
12.46%
96.00%
4.00%
2000
100%
37.42%
56.47%
10.86%
67.33%
16.68%
84.01%
12.08%
96.09%
3.91%
IRS changed methodology, so data above and below this line not strictly comparable
2001
100%
15.68%
33.22%
52.24%
11.44%
63.68%
17.88%
81.56%
13.54%
95.10%
4.90%
2002
100%
15.09%
33.09%
52.86%
11.77%
64.63%
18.04%
82.67%
13.12%
95.79%
4.21%
2003
100%
15.37%
33.69%
53.54%
11.35%
64.89%
17.87%
82.76%
13.17%
95.93%
4.07%
2004
100%
17.12%
36.28%
56.35%
10.96%
67.30%
16.52%
83.82%
12.31%
96.13%
3.87%
2005
100%
18.91%
38.78%
58.93%
10.52%
69.46%
15.61%
85.07%
11.35%
96.41%
3.59%
2006
100%
19.24%
39.36%
59.49%
10.59%
70.08%
15.41%
85.49%
11.10%
96.59%
3.41%
2007
100%
19.84%
39.81%
59.90%
10.51%
70.41%
15.30%
85.71%
10.93%
96.64%
3.36%
2008
100%
18.20%
37.51%
58.06%
11.14%
69.20%
16.37%
85.57%
11.33%
96.90%
3.10%
2009
100%
16.91%
36.34%
58.17%
11.72%
69.89%
16.85%
86.74%
10.80%
97.54%
2.46%
2010
100%
17.88%
37.38%
59.07%
11.55%
70.62%
16.49%
87.11%
10.53%
97.64%
2.36%
Source: IRS
Table 7. Dollar Cut-Off, 1980-2010
(Minimum AGI for tax return to fall into various percentiles; thresholds not adjusted for inflation)
Year
Top 0.1%
Top 1%
Top 5%
Top 10%
Top 25%
Top 50%
1980
$80,580
$43,792
$35,070
$23,606
$12,936
1981
$85,428
$47,845
$38,283
$25,655
$14,000
1982
$89,388
$49,284
$39,676
$27,027
$14,539
1983
$93,512
$51,553
$41,222
$27,827
$15,044
1984
$100,889
$55,423
$43,956
$29,360
$15,998
1985
$108,134
$58,883
$46,322
$30,928
$16,688
1986
$118,818
$62,377
$48,656
$32,242
$17,302
Tax Reform Act of 1986 changed the definition of AGI, so data above and below this line not strictly comparable
1987
$139,289
$68,414
$52,921
$33,983
$17,768
1988
$157,136
$72,735
$55,437
$35,398
$18,367
1989
$163,869
$76,933
$58,263
$36,839
$18,993
1990
$167,421
$79,064
$60,287
$38,080
$19,767
1991
$170,139
$81,720
$61,944
$38,929
$20,097
1992
$181,904
$85,103
$64,457
$40,378
$20,803
1993
$185,715
$87,386
$66,077
$41,210
$21,179
1994
$195,726
$91,226
$68,753
$42,742
$21,802
1995
$209,406
$96,221
$72,094
$44,207
$22,344
1996
$227,546
$101,141
$74,986
$45,757
$23,174
1997
$250,736
$108,048
$79,212
$48,173
$24,393
1998
$269,496
$114,729
$83,220
$50,607
$25,491
1999
$293,415
$120,846
$87,682
$52,965
$26,415
2000
$313,469
$128,336
$92,144
$55,225
$27,682
IRS changed methodology, so data above and below this line not strictly comparable
2001
$1,393,718
$306,635
$132,082
$96,151
$59,026
$31,418
2002
$1,245,352
$296,194
$130,750
$95,699
$59,066
$31,299
2003
$1,317,088
$305,939
$133,741
$97,470
$59,896
$31,447
2004
$1,617,918
$339,993
$140,758
$101,838
$62,794
$32,622
2005
$1,938,175
$379,261
$149,216
$106,864
$64,821
$33,484
2006
$2,124,625
$402,603
$157,390
$112,016
$67,291
$34,417
2007
$2,251,017
$426,439
$164,883
$116,396
$69,559
$35,541
2008
$1,867,652
$392,513
$163,512
$116,813
$69,813
$35,340
2009
$1,469,393
$351,968
$157,342
$114,181
$68,216
$34,156
2010
$1,634,386
$369,691
$161,579
$116,623
$69,126
$34,338
Source: IRS
Table 8. Average Tax Rate, 1980-2010 (Percent of AGI paid in income taxes)
Year
Total
Top 0.1%
Top 1%
Top 5%
Between 5% & 10%
Top 10%
Between 10% & 25%
Top 25%
Between 25% & 50%
Top 50%
Bottom 50%
1980
15.31%
34.47%
26.85%
17.13%
23.49%
14.80%
19.72%
11.91%
17.29%
6.10%
1981
15.76%
33.37%
26.59%
18.16%
23.64%
15.53%
20.11%
12.48%
17.73%
6.62%
1982
14.72%
31.43%
25.05%
16.61%
22.17%
14.35%
18.79%
11.63%
16.57%
6.10%
1983
13.79%
30.18%
23.64%
15.54%
20.91%
13.20%
17.62%
10.76%
15.52%
5.66%
1984
13.68%
29.92%
23.42%
15.57%
20.81%
12.90%
17.47%
10.48%
15.35%
5.77%
1985
13.73%
29.86%
23.50%
15.69%
20.93%
12.83%
17.55%
10.41%
15.41%
5.70%
1986
14.54%
33.13%
25.68%
15.99%
22.64%
12.97%
18.72%
10.48%
16.32%
5.63%
Tax Reform Act of 1986 changed the definition of AGI, so data above and below this line not strictly comparable
1987
13.12%
26.41%
22.10%
14.43%
19.77%
11.71%
16.61%
9.45%
14.60%
5.09%
1988
13.21%
24.04%
21.14%
14.07%
19.18%
11.82%
16.47%
9.60%
14.64%
5.06%
1989
13.12%
23.34%
20.71%
13.93%
18.77%
12.08%
16.27%
9.77%
14.53%
5.11%
1990
12.95%
23.25%
20.46%
13.63%
18.50%
12.01%
16.06%
9.73%
14.36%
5.01%
1991
12.75%
24.37%
20.62%
13.96%
18.63%
11.57%
15.93%
9.55%
14.20%
4.62%
1992
12.94%
25.05%
21.19%
13.99%
19.13%
11.39%
16.25%
9.42%
14.44%
4.39%
1993
13.32%
28.01%
22.71%
14.01%
20.20%
11.40%
16.90%
9.37%
14.90%
4.29%
1994
13.50%
28.23%
23.04%
14.20%
20.48%
11.57%
17.15%
9.42%
15.11%
4.32%
1995
13.86%
28.73%
23.53%
14.46%
20.97%
11.71%
17.58%
9.43%
15.47%
4.39%
1996
14.34%
28.87%
24.07%
14.74%
21.55%
11.86%
18.12%
9.53%
15.96%
4.40%
1997
14.48%
27.64%
23.62%
14.87%
21.36%
12.04%
18.18%
9.63%
16.09%
4.48%
1998
14.42%
27.12%
23.63%
14.79%
21.42%
11.63%
18.16%
9.12%
16.00%
4.44%
1999
14.85%
27.53%
24.18%
15.06%
21.98%
11.76%
18.66%
9.12%
16.43%
4.48%
2000
15.26%
27.45%
24.42%
15.48%
22.34%
12.04%
19.09%
9.28%
16.86%
4.60%
IRS changed methodology, so data above and below this line not strictly comparable
2001
14.47%
28.17%
27.60%
23.91%
15.20%
21.68%
11.87%
18.35%
9.20%
16.08%
4.92%
2002
13.28%
28.48%
27.37%
23.17%
14.15%
20.76%
10.70%
17.23%
8.00%
14.87%
3.86%
2003
12.11%
24.60%
24.38%
20.92%
12.46%
18.70%
9.69%
15.57%
7.41%
13.53%
3.49%
2004
12.31%
23.06%
23.52%
20.83%
12.53%
18.80%
9.41%
15.71%
7.27%
13.68%
3.53%
2005
12.65%
22.48%
23.15%
20.93%
12.61%
19.03%
9.45%
16.04%
7.18%
14.01%
3.51%
2006
12.80%
21.94%
22.80%
20.80%
12.84%
19.02%
9.52%
16.12%
7.22%
14.12%
3.51%
2007
12.90%
21.42%
22.46%
20.66%
12.92%
18.96%
9.61%
16.16%
7.27%
14.19%
3.56%
2008
12.54%
22.67%
23.29%
20.83%
12.66%
18.87%
9.45%
15.85%
6.97%
13.79%
3.26%
2009
11.39%
24.28%
24.05%
20.59%
11.53%
18.19%
8.36%
14.81%
5.76%
12.61%
2.35%
2010
11.81%
22.84%
23.39%
20.64%
11.98%
18.46%
8.70%
15.22%
6.01%
13.06%
2.37%
Source: IRS
Some important facts to keep in mind about the information provided here.
(1) For data prior to 2001, all tax returns that have a positive AGI are included, even those that do not have a positive income tax liability. For data from 2001 forward, returns with negative AGI are also included, but dependent returns are excluded.
(2) Income tax after credits (the tax measure above) does not account for the refundable portion of EITC. If it were included (as is often the case with other organizations), the tax share of the top income groups would be higher. The refundable portion is legally classified as a spending program by the Office of Management and Budget and therefore is not included by the IRS in these figures.
(3) The only tax analyzed here is the federal individual income tax, which is responsible for about 25 percent of the nation's taxes paid (at all levels of government). Federal income taxes are much more progressive than payroll taxes, which are responsible for about 20 percent of all taxes paid (at all levels of government), and are more progressive than most state and local taxes (depending upon the economic assumption made about property taxes and corporate income taxes).
(4) AGI is a fairly narrow income concept, and does not include income items like government transfers (except for the portion of Social Security benefits that is taxed), the value of employer-provided health insurance, underreported or unreported income (most notably that of sole proprietors), income derived from municipal bond interest, net imputed rental income, worker's compensation benefits and others.
(5) Tax return is the unit of analysis, which is broader than households, especially for those at the bottom end, many of which are dependent returns (prior to 2001). Some dependent returns are included in the figures here prior to 2001, and under other units of analysis (like the Treasury Department's Family Economic Unit) would likely be paired with their parents' returns.
(6) The data source is the IRS Statistics of Income Division, which uses a national sample of tax returns to provide the figures used here. The figures above for 2010 were taken from data that were labeled an "early release" by SOI in November 2012. The 2009 figures and those for previous years on this page were taken from the final percentile data released by the IRS. Figures for 2010 may be subsequently revised.
(7) These figures represent the legal incidence of the income tax, although most distributional tables (such as those from CBO, Tax Policy Center, Citizens for Tax Justice, Treasury, and JCT) assume that the entire economic incidence of personal income taxes falls on the income earner.
