How much does the average American family pay in taxes?
Combining direct and indirect taxes, as well as taxes from state and local government, the average American family paid $17,902 in taxes in 2021.
One of the simplest ways to think about the US standard of living is to consider how much people earn in income, pay in taxes, and receive in government transfers. A government transfer can be cash, or non-cash in the form of services like Medicaid and Medicare.
In 2021, the average American family in the middle 20% of income earners paid $17,902 in taxes to federal, state, and local governments. This includes direct taxes, such as income taxes, as well as indirect taxes, like payroll taxes. Of all the taxes the middle 20% paid in 2021, $10,391 went to federal income tax.
What is the average family market income?
Meanwhile, the same family in the middle 20% earned $59,757 from market sources, including from dividends and capital gains. To make it into the middle 20% of families in 2021, a family would have to earn between $41,900 and $80,000.
What does the average family get in government transfers?
In 2021, the average middle 20% family received $30,033 in transfers from the government, including supplemental security income and other cash, and non-cash transfers, such as Medicaid and Medicare. The second 20%, however, received the most from the federal government: $37,330.
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Keep exploring
- How is the middle class changing? - The middle class in the US is getting older, working less, and earning less. Support from government programs are making up the difference.
- Which states have the highest and lowest income tax? - Oregon collected the most state income taxes in 2023, while nine states collected no income tax at all.
- How much money does the government collect per person? - Individual income taxes accounted for more than half of total revenues for the federal government in 2022.
- Who pays the most income tax? - In 2023, the top 5% of earners collectively paid nearly $1.3 trillion in income taxes, or about 60% of the national total.