Many people think that the rich are able to weasel their way out of taxes, but they actually pay an overwhelming majority of the taxes in the United States.
What's more, their share of the tax burden is increasing. The top 10 percent of taxpayers paid over 70% of the total amount collected in federal income taxes in 2010, the latest year figures are available, according to the Tax Foundation, a right-leaning think tank. That's up from 55% in 1986.
The remaining 90% bore just under 30% of the tax burden. And 47% of all Americans pay hardly anything at all -- a fact that got Republican presidential candidate Mitt Romney into political hot water last year.
"There's been a huge myth created that the rich aren't paying anything," said William McBride, the Tax Foundation's chief economist. "The rich pay a much higher rate than the poor."
These numbers may not tell the whole story though. The tax code is getting more progressive, said Roberton Williams, a senior economist at the centrist Tax Policy Center. In 1986 there were just two tax rates -- 15% and 28%. Now there are seven income tax brackets, going from a low of 10% to a high of nearly 40%.
While taxes on investment income have declined a bit since 1986, incentives like child care and income tax credits for the poor have been greatly expanded.
But the rich are able to take advantage of tax breaks too. That's why Williams said there's a popular notion that the wealthy are somehow cheating the tax man. In fact, the Tax Policy Center found last year that there about 4,000 households with incomes over $1 million that were not paying anything at all.
(Excerpt) Read more at finance.yahoo.com ...
