NEW YORK (CNNMoney.com) -- Most people think they pay too much to Uncle Sam, but for some people it simply is not true.
In 2009, roughly 47% of households, or 71 million, will not owe any federal income tax, according to estimates by the nonpartisan Tax Policy Center.
Some in that group will even get additional money from the government because they qualify for refundable tax breaks.
The ranks of those whose major federal tax burdens net out at zero -- or less -- is on the rise. The center's original 2009 estimate was 38%. That was before enactment in February of the $787 billion economic recovery package, which included a host of new or expanded tax breaks.
The issue doesn't get a lot of attention even as lawmakers debate how to pay for policy initiatives like health reform, whether to extend the Bush tax cuts and how to reduce the deficit.
The vast majority of households making up to $30,000 fall into the category, as do nearly half of all households making between $30,000 and $40,000.
As you move up the income scale the percentages drop.
Nearly 22% of those making between $50,000 and $75,000 end up with no federal income tax liability or negative liability as do 9% of households with incomes between $75,000 and $100,000.
Of course, income taxes don't tell the whole story. Workers are also subject to payroll taxes, which support Social Security and Medicare.
When considering federal income taxes in combination with payroll taxes, the percent of households with a net liability of zero or less is estimated to be 24% this year, according to the Tax Policy Center's estimates.
A key reason why there is a zero-liability group at all is because the U.S. tax system is progressive. Those who bring in more money pay more than those lower down the income scale to support government functions such as national defense and social safety nets like Medicaid for those in need. That progressivity can be dialed up or down.
"Some think it's too progressive. Some don't think it's progressive enough," said Roberton Williams, a senior fellow at the center.
President Obama falls into the latter camp. He has proposed increasing the income tax burden on families making more than $250,000 and individuals making more than $200,000, while offering new measures to reduce the tax bite for most Americans making less.
One of Obama's proposals is to extend the 2001 and 2003 Bush tax cuts for everyone except high-income tax filers, which was the group that derived the most benefit from those cuts.
It amuses me that so many Americans still whine about taxes, even after the rounds of Bush tax cuts for the wealthy, and the Obama tax cuts for the not so wealthy. Do you still whine about taxes even when you don't pay any? If you don't pay any taxes, who is going to pay them for you? The roads you drive on, the army that fights for you in Iraq and Afghanistan, the national debt that has been created over the past thirty years with a short holiday at the end of the Clinton years, where's that money coming from?




Comments: 10
These numbers are bogus because they include people who have never worker, and have been disable since birth or before entering the workforce.
Where are the numbers for workers only.
And yes the income tax credit is a Republican version of welfare in lieu of raising the minimum wage,
President Ford's idea, during a time of very high inflation. (oil embargo)
So this is why the saying,
"Lies, damned lies and statistics. "
Samuel Clemens I think
It is like that stupid 50% of the tax payers pay 90% of the taxes, once again ignoring the retired.
Be it from Cigarettes to Soda, from Energy to Health-care items now, they get their ever increasing tax money from everybody, someway, somehow eventually.