Home Economy Report: First 113 Days of Americans’ Earnings Goes to Taxes

Report: First 113 Days of Americans’ Earnings Goes to Taxes

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                Report: First 113 Days of Americans' Earnings Goes to Taxes

A just-out report reveals Americans will spend a whopping 113 days working to pay taxes before they see a dime of their hard-earned money for themselves.

The Tax Foundation said this year's "Tax Freedom Day" falls on Sunday, April 23, representing "how long Americans as a whole have to work in order to pay the nation's tax burden."

Americans will pay $3.5 trillion in federal taxes and $1.6 trillion in state and local taxes, for a total bill of more than $5.1 trillion, or 31 percent of the nation's income, this year, according to Tax Foundation analyst Scott Greenberg.

That means they will "collectively spend more on taxes in 2017 than they will on food, clothing, and housing combined."

"If you include annual federal borrowing, which represents future taxes owed, "Tax Freedom Day" would occur 14 days later, on May 7," Greenberg said.

To break it down further, this year, Americans will work the longest — 46 days — to pay federal, state, and local individual income taxes.

The remaining six days are spent paying estate and inheritance taxes, customs duties, and other taxes.

How long Uncle Sam's hand remains in your pocket varies state by state.

Greenberg said the total tax burden borne by residents across states "varies considerably due to differing tax policies and the progressivity of the federal tax system."

"States with higher incomes and higher taxes celebrate 'Tax Freedom Day' later: Connecticut (May 21), New Jersey (May 13), and New York (May 11)," he explained.

"Residents of Mississippi bear the lowest average tax burden in 2017, with their Tax Freedom Day having arrived on April 5. Also early were Tennessee (April 7) and South Dakota (April 8)."

The Tax Foundation is an 80-year-old independent tax policy nonprofit based in Washington, D.C.

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