Next week is Tax Day. Some taxpayers owe Uncle Sam more than others. Everyone loves the party game “Two Truths and a Lie.” Can you identify which of the three following statements about who pays the most in taxes?

A. The top one percent nearly paid a larger share of income taxes than the bottom 90 percent combined.

B. Half of the taxpayers paid nearly all of the income taxes.

C. The wealthy don’t pay their fair share.

A. TRUTH! In general, higher-income Americans pay a significantly larger share of total income taxes.

In 2021, 46% of all federal income taxes came from the top 1 percent (adjusted gross incomes or AGI of over $682,000). The top 1 percent of taxpayers paid an average income tax rate of 25.93%—the highest rate and nearly eight times the rate faced by the bottom half of taxpayers.

B. TRUTH!  In 2021, the top half of taxpayers (AGIs above $46,637) paid 97.7% of all income taxes while they earned 89.6% of income. Meanwhile, the bottom half of taxpayers paid just 2.3% of taxes while earning 10.4% of income. Also, the top 1% of taxpayers earned 26.3% of total AGI but paid 45.8% of all federal income taxes.

C. LIE! Altogether, the highest earners pay the most in federal taxes.

The top 10% of households pay over 70% of all federal income taxes combined including income, payroll, corporate, estate, and excise taxes. Yet, there are some categories where lower-income Americans pay larger shares of their incomes than higher-income households such as on payroll taxes (FICA and MEDFICA), which fund our entitlement programs, and excise taxes on goods and activities such as alcohol, gas, and gambling.

Bottom line:

 A common refrain today is that the rich “don’t pay their fair share.” But do people really know what that means and whether it is true? Some 10% of Americans pay nearly three-quarters of all income taxes. High-income households are paying significantly to support our federal budget, contrary to what Americans think. Yet, about six in ten Americans don’t think the wealthy pay their fair share according to Pew Research

President Joe Biden and others are using misinformation about tax policy and who pays the most in taxes to seek support for raising federal taxes on high-earning households to fund more wasteful spending. Americans need to know the facts.