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Tax Collection Statistics You Need To Know

Tax Collection Statistics You Need To Know

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Tax Collection Statistics You Need To Know

To get a glimpse of the enormity of the IRS and the federal government's revenue through taxation, one simply needs to observe the federal tax statistics in America. Funds generated through IRS taxes are essential to fuel the public goods and services offered by the central government. Without revenue created from the IRS tax levy,the federal government would cripple, and America would severely fragment. 


To appropriately review the magnitude and effectiveness of IRS taxes one must compare and contrast the different forms of taxation and their corresponding percentages based on varying years. The following chart will document IRS taxes in 2007, the number of returns, the amount of gross collection, and their relevant percentages. The chart below was taking from the IRS website (IRS.gov), which offers infallible and detailed statistics for all forms of IRS taxes.


Type of Return

Number of Returns

Gross Collection

Individual Income Tax

138,893,908

1,366,241,000,000

Employment Taxes

30,740,952

849,733,000,000

Corporate Income Tax

2,507,728

395,536,000,000

Excise Taxes

989,165

53,050,000,000

Estate Taxes

55,924

24,558,000,000

Gift Taxes

286,522

2,420,000,000



In 2007, there was a total of 173,351,839 separate tax returns which accounted for $2,691,538,000,000. The 2 trillion+ dollars accumulated through the IRS tax is allocated between various public goods and services. The government's appropriated numbers vary from public perception but in 2007 the following percentages were apportioned as such:20% was given to the military for defense purposes, 33% was spent on medicare, 8% was used to pay off our nation's debt, 21% was given to social security, and the following 18% was allocated for discretionary reasons.


The IRS tax, through observation of the above statistics are incredibly exorbitant. Most don't realize the amount of funding necessary to run a country as large, diverse, and powerful as the United States of America. Even though IRS taxes account for trillions of dollars of public funding each year, America is still operating under an obscene deficit. To further elaborate on such statistics one can observe that the Individual Income Tax is the predominant source of revenue for the national government. 



More than 50% of revenue acquired through IRS taxes is generated from the Individual Income Tax. This number has steadily increased over the year due to rising wages and inflation. To meet inflation, and the rising CPI, wages need to appropriately increase. As a result of the progressive tax system, the more money an individual makes, the more taxes he/she pays. 



This relationship is tangible through inspection of year to year tax statistics. In 2006 for instance, the personal income tax accounted for just 44% of the total gross collection from IRS taxes. That being said, the main source of yearly revenue is always spawned through the personal income tax. In essence, if all other revenue was combined through the various forms (employment taxes, corporate income tax, excise taxes, estate taxes, and gift taxes) of IRS tax levied the numbers would not equal the amount collected from the individual income tax. 


The individual income tax levied by the IRS is the most complex and important form of levy for the national government. The income tax category includes a collection of funds from the four divisions of the IRS. Individuals (investments and wages, small businesses, mid to large cap corporations, and government entities or non-profits all contribute to the personal income tax levy. The progressive system, places a responsibility on those individuals who yield higher annual incomes. For example the progressive income tax breakdown in America for 2010 is as follows:

Amount of Annual Taxable Income

Corresponding Tax rate

0-$8,375

10%

$8,375-$34,000

15%

$34,000-$82,400

25%

$82,400-$171,850

28%

$171,850-$373,650

33%

$373,650-above

35%


Due to the proportional relationship between tax rate and annual income, the top tax bracket routinely accounts for 60-65% of all revenue produced through the personal income tax. Although the numbers are prodigious the IRS estimates that on average, $250-$300 billion dollars a year go uncollected.


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