Thursday, February 18, 2010

Life at the top 

David Wessel writes a fascinating blog on the top 400 individual taxpayers out of 143 million filed.
To make the top 400, a taxpayer had to have income of more than $138.8 million. As a group, the top 400 reported $137.9 billion in income, and paid $22.9 billion in federal income taxes.

About 81.3% of the income of the top 400 households came in the form of capital gains, dividends or interest, the IRS data show. Only 6.5% came in the form of salaries and wages.

Over the past 16 tax years 3,472 different taxpayers showed up in the top 400 at least once. Of these taxpayers, a little
more than 27% appear more than once. In any given year, about 40% percent of the top-400 returns were filed by taxpayers who weren�t in that exclusive club in any of the 15 years .
The report details sources of deductions as well as of income. Over half of deductions came from charitable contributions, which totaled $11.1 billion. No wonder the Obama Administration wishes to limit that deduction! The group also paid $5.4 billion in state and local taxes and $1.6 billion in taxes to foreign countries.

But the last paragraph is what interested me most. 73% of taxpayers who made the top 400 only made it for one year. 7 taxpayers made it all 16 years. The top 400 "mostly represent a changing group of taxpayers over time, rather than a fixed group of taxpayers." When people want to talk about "the uber-rich" they describe a fleeting thing.