The Rich Don't Pay Their Fair Share — Really?

The Rich Don't Pay Their Fair Share — Really?

It's election season again. Like clockwork, candidates reach into their closets, dust off their time-worn catchphrases, and parade them down the campaign trail. My favorite — one that surfaces both in and out of election season, and somehow never gets refuted — is this:

"The rich don't pay their fair share."

Let's take a few minutes and actually drill into that claim. I'm going straight to the source: the IRS. ¹ They publish this data every year, and 2023 is the most recent available. I've tracked it annually, and the year-over-year changes are negligible.

I know it's numbers — but stay with me. For each income range, I'll give you two figures: share of income(what percentage of total national income that group earned) and share of federal income tax paid.

 

The $100K and Up Crowd

Income Range

Share of National Income

Share of Federal Income Tax Paid

$100K – $200K

25%

19%

$200K – $500K

21%

24%

$500K – $1M

8%

13%

Over $1M

17%

32%

Combined: Earners at $100K and above represent 69% of tax filers and paid 88% of all federal income tax revenue.

Narrowing to the so-called "rich" — those earning $200K and up:

  • Share of national income: 46%
  • Share of federal income tax paid: 69%

Since no one else seems willing to say it — thank you. This group is the backbone of federal tax revenue, and that's before factoring in Social Security tax, Medicare tax, and state income tax (for the 43 states that have one).

 

The Under $100K Crowd

Income Range

Share of National Income

Share of Federal Income Tax Paid

$75K – $100K

9%

5%

$50K – $75K

10%

5%

$25K – $50K

9%

3%

$0 – $25K

3%

0%

Combined: Earners from $1 to $100K represent 31% of national income and paid 12% of federal tax revenue.

 

So, Who Isn't Paying Their Fair Share?

The data tells a clear story. The next time a candidate dusts off that line, it's worth asking: fair share compared to what, exactly?

You're already carrying more than your share of the tax burden. The least you can do for yourself is make sure you're not paying a dollar more than you legally owe.

 

Keep More of What You Work For

At Montage Wealth Advisors, one of our primary objectives is exactly that — helping you keep more of what you've earned. As tax and financial experts, we have the tools and strategies to make a real difference in what stays in your pocket. Give us a call to find out how.

 

¹ Source: Internal Revenue Service; Washington Post