Happy belated Tax Freedom Day 2012
Saturday, April 21, 2012
Tax Freedom Day arrived on Tax Day this year.
April 17 was, according to Tax Foundation computations, the first day of 2012 that Americans as a whole had earned enough income to pay this year's tax burdens.
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In its annual Tax Day calculation, the Washington-based tax research nonprofit considers every dollar that is officially considered income and every payment to all levels of government.
Americans worked 107 days (Jan. 1 to April 17) to earn enough money to pay 2012's combined 29.2 percent federal, state, and local tax bills.
The latest ever Tax Freedom Day was May 1, 2000. That year, according to the Tax Foundation, Americans paid 33 percent of their total income in taxes.
A century earlier, in 1900, Americans paid only 5.9 percent of their income in taxes, meaning Tax Freedom Day came on Jan. 22.
Types of taxes: "This year, Americans will pay $2.62 trillion in federal taxes and $1.42 trillion in state-local taxes out of $13.86 trillion in income, for a 29.2 percent tax bill," said Tax Foundation economist Will McBride. "That means taxpayers will pay more in taxes in 2012 than they will spend on food, clothing, and housing combined."
Individual income taxes, including federal, state and local levies, require 40 days of work.
Payroll taxes take another 23 days of work.
Sales and excise taxes, mostly state and local, take 15 days to pay off.
Property taxes take 12 days to pay.
Corporate income taxes take another 10 days.
50 State Tax Freedom Days: The total tax burden by state residents varies considerably, notes the Tax Foundation, because of differing state tax policies and the progressivity of the federal tax system.
This means higher-income states celebrate Tax Freedom Day later: Connecticut on May 5 and New Jersey and New York on May 1.
Tennessee taxpayers have the lowest average tax burden in 2012. Tax Freedom Day in the Volunteer State arrived on March 31.
Other early Tax Day celebrants included Louisiana and Mississippi on April 1, South Carolina on April 3 and South Dakota on April 4.
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