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The percentage of federal income taxes paid by the top 1% of earners varies depending on the metric used, such as the share of total taxes paid or the average effective tax rate. Statistics often differ based on the data source, the year analyzed, and whether capital gains are heavily weighted. (as of 2024/2025 data availability)
Share of Total Federal Income Taxes Paid
Top 1% Share: Several sources indicate the top 1% paid approximately 33% to 40% of all federal income taxes Site icon Site icon .
Context: This share represents the portion of the total income tax liability accounted for by this income bracket Site icon .
Time Sensitivity: Specific figures may fluctuate annually based on economic performance and tax filing data Site icon .
Average Effective Tax Rates
General Range: Some analyses suggest the top 1% group pays an "all-in tax rate" around 25.5% for the highest earners (top 0.01%) Site icon .
Income Level: Another estimate suggests the top 1% pays a little over one-third of their income in taxes on average Site icon .
Investment Income: A significant portion of the top 1%'s income often comes from investments, such as capital gains and dividends Site icon .
Variations and Comparisons
Earned Income Share: The top 1% group's share of total earned income is generally reported to be lower than their share of total income taxes paid Site icon .
Wealthy vs. Top 1%: Studies focusing on the ultra-wealthy (e.g., billionaire families) sometimes report significantly lower average federal individual tax rates (e.g., 8.2% in one 2021 study) when considering all forms of income and rates Site icon .
Tax Brackets: Federal income tax is generally progressive, meaning higher income layers are taxed at progressively higher marginal rates Site icon .