You work hard for your money…so you better fork it over to the federal and state governments.
The Tax Foundation released a new report Monday that concluded Tax Freedom Day takes place 111 days into 2014 on Apr. 21, which is up three days from a year ago because of the slow economic recovery. If federal borrowing is factored into the calculation then Tax Freedom Day would occur May 6.
By this time, Americans will have doled over $3 trillion to the federal government and another $1.5 trillion in state taxes – this accounts for one-third of income. The total of $4.5 trillion is more than what households will spend the fruits of their labor on clothing, food and housing combined.
“Since 2002, federal expenses have exceeded federal revenues, with the budget deficit exceeding $1 trillion annually from 2009 to 2012 and over $800 billion in 2013,” the tax group said in a statement. “In 2014, the deficit will continue to decline to $636 billion. If we include this annual federal borrowing, which represents future taxes owed, Tax Freedom Day would occur on May 6, 15 days later. The latest ever deficit-inclusive Tax Freedom Day occurred during World War II on May 21, 1945.”
Tax burdens and policies differ from state to state. This means that some Americans will celebrate Tax Freedom Day earlier or later:
– Connecticut: May 9
– New Jersey: May 9
– New York: May
– Louisiana: Mar. 30
– Mississippi: Apr. 2
– South Dakota: Apr. 4
“The latest ever Tax Freedom Day was May 1, 2000, meaning Americans paid 33.0 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 January 22,” the group added.
The U.S. national debt is closing in on $18 trillion with interest payments adding up to more than $2.5 trillion. This means debt per taxpayer is roughly $150,000 in addition to $8,000 in interest per person. If one were to calculate entire U.S. debt then it would equate to $758,000 per family.
It could be worse: nearly half (43 percent) of Canadians’ incomes go to the government.