Chapter 3 Activity - Taxes Individual Income Tax Brackets (2020) Head of Single, taxable Joint, taxable income over: Household, taxable income over: income over: Marginal Tax Rate 10% $0 $ $d 12% $9,878 $19,750 $14,100 22% $40,125 $80,250 $53,700 24% $65,525 $171,050 $85,500 32% $163,300 $326,600 $163,300 35% $207,350 $414,700 $207,350 37% $518,400 $622,050 $518,400 Standard Deduction Amounts (2020) Filing Status Deduction Amount Single $12,400 Married Filing Jointly $24,800 Head of Household $18,650 Long-term Capital Gains & Qualified Dividends (2020) Tax Rate Single Joint Head of Household Under $53,600 0% Under $40,000 Under $80,000 15% $80,000 $40,000 $441,450 $53,600 $469,050 20% $496,600 Additional 3.8% Net Investment Income Tax for MAGI over $200,000 / $250,000 / $200,000 + Federal Income Tax Summary (2017) Top 1% Top 5% Top 10% Top 25% Top 50% Bottom 50% All Taxpayers Number of Returns 11,432,952 7. 164,758 114,329,516 35,823,790 171,647,580 71,647,580 143,295,160 Adjusted Gross Income ($ millions) $2,301,449 $3,995,037 $5,220,949 $7,561,368 $9,706,054 $1,230,446 $10,936,500 Share of Total Adjusted Gross Income 21.0% 36.5% 147.7% 69.1% 88.7% 11.3% 100.0% Income Taxes Paid ($ millions) $615,979 $946,954 $1,122,158 $1,378,757 $1,551,537 |$49,772 $1,601,309 Share of Total Income Taxes Paid 38.5% 59.1% 70.1% 86.1% 96.9% 3.1% 100.0% Income Split Point $515,371 $208,053 $145,135 $83,682 |$41,740 $41,740 Average Tax Rate 26.8% 23.7% 21.5% 18.2% 16.0% 4.0% 14.6% Note: numbers above are for taxpayers, not households... i.e. The top 25% of taxpayers," not households". 3. The top 1% of taxpayers make at least $ % of federal income taxes. Their average tax rate is %. 4. The top 10% of taxpayers make at least $ % of federal income taxes. Their average tax rate is %. 5. The top 50% of taxpayers make at least $ % of federal income taxes. Their average tax rate is %. and pay and pay and pay and pay 6. The bottom 50% of taxpayers make less than 5 % of federal income taxes. Their average tax rate is %. 7. REACTION: What do you make of your findings above? What surprised (or did not surprise) you