By Andre Damon
20 February 2010
The incomes of the very rich in the US grew phenomenally between 1992 and 2007, while their tax rates plummeted, according to recently uncovered IRS statistics.
The figures were published on the IRS web site in December of 2009, but received little notice because they were not announced. The report only became widely known when Tax Analysts, a news outlet for tax information, discovered the document and wrote about it on its web site, tax.com, on Thursday.
The report shows that the average income for the top-earning 400 families, denominated in 1990 dollars, grew from $17 million to $87 million, representing a five-fold increase in real terms. During this time, the percentage of the total national income that went to the top 400 families tripled, from .52 percent in 1992 to 1.59 in 2007.
The data shows that these families saw their incomes increase by 31 percent between 2006 and 2007 alone, while the average income of each family reached $345 million.
The amount of money earned by the group more than doubled from 2001, when its members earned on average $131.1 million. In 1993, the top 400 tax return filings amounted on average to $46 million. This means that there was an eight-fold nominal increase in the average earnings for this group between 1993 and 2007.
Meanwhile, the effective tax rate on this group—the amount actually paid in taxes—fell to 16.6 percent, the lowest figure on IRS records dating to 1992.
Related articles: