Jan 7, 2024
Our household’s income puts us well above the top ten percent, and nearly the top five percent. Yet our effective tax rate is generally around 22-23%.
No one but the very wealthy would theoretically come close to a 40% effective rate, and most of their income comes from capital gains, which is taxed at a lower rate than ordinary income, so in fact many one percenters pay a lower effective tax rate than I do.