Do you pay too much to the IRS? See how your tax bill compares
A majority of Americans think that they are taxed too much and that they are paying more than their fair share. But what do the numbers say?
A recent survey by the Cato Institute found that a majority of Americans from all political stripes, 55 percent, can agree on something, they paid too much in taxes this year. The same percentage of the 2,000 respondents believe that what they are paying to the Internal Revenue Service is more than their fair share.
Part of this could come down to incorrectly understanding of the tax brackets and that they are applied progressively. According to another survey conducted by the Tax Foundation, more than half of respondents lacked basic tax literacy regardless of educational attainment.
How does your IRS tax bill compare?
Currently, there are seven tax brackets and each bracket is progressively applied to a taxpayer’s income in excess of the upper limit.
So even those who are in the top tax bracket, have each graduated percentage applied to their income that falls within each of the seven brackets. That means that they don’t pay 37% on all of their income, but just that above $626,350, the threshold for the 2025 fiscal year. Likewise 10% is levied on their income up to $11,925, with the 12%, 22%, 24%, 32% and 34% applied to the earnings amount that corresponds to those brackets.
According to IRS data analyzed by the Tax Foundation, among all taxpayers the average rate was about 14.5% in the 2022 tax year. However, those with the highest incomes, the ‘One Percenters’, as a percentage of their earnings paid nearly twice as much. These taxpayers accounted for over 40% of the revenue the IRS collected that year.
The latest IRS data shows the US federal income tax system continues to be progressive as high-income taxpayers pay the highest average income tax rates. pic.twitter.com/FjrJCxHf6X
— Tax Foundation (@TaxFoundation) April 5, 2025
On the other hand, the bottom half of the US population paid a little more than four percent of their income to the IRS. Similarly, this group’s share of total income taxes paid was just three percent, with each taxpayers in the group forking over on average $822 that tax year.
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