Although it seems that covid-19 infections are diminishing, the aftermath of the pandemic is still going strong. Taxpayers are pinching pennies in all areas as they try to recover what they\u2019ve lost. With this in mind, it\u2019s natural to be curious about the average income tax payment in America. Most of us want to pay our fair share, but certainly no more. So, we decided to do a bit of digging to find out what that is.<\/p>\n\n\n\n
With so many categories of taxpayers, it\u2019s important to point out that we are specifically discussing W2 employees. Small businesses, 1099, and corporations are not included in this article. Read further to gain a better understanding of what other W2 Americans pay at tax time.<\/p>\n\n\n\n
Income tax isn\u2019t the only tax your employer withholds from your paycheck. The Federal Contributions Act (FICA) mandates that they withhold two additional taxes. The FICA tax rate is 6.2 percent for a social security fund and 1.45 percent for a Medicare fund. Additionally, your employer matches these percentages on your behalf as their employee.<\/p>\n\n\n\n
The Social Security Administration<\/a> explains FICA taxes further. \u201cThe money you pay in taxes is not held in a personal account for you to use when you get benefits. Today\u2019s workers help pay for current retirees\u2019 and other beneficiaries\u2019 benefits. Any unused money goes to the Social Security trust funds to help secure today and tomorrow for you and your family.\u201d<\/p>\n\n\n\n Payroll deductions like these and others can affect how one calculates the average income tax payment. For example, according to Business Insider<\/a>, 153 million Americans paid an average of $15,322 in 2018. They also offer a caveat to clarify what they considered when calculating the average. \u201cThat figure is an average, a measure which is easily skewed by outliers, including about 22,000 returns of people who took home more than $10 million in 2019, for example.\u201d<\/p>\n\n\n\n Lastly, we need to point out that there are other attributes that can alter the calculations of the average income tax payment. For instance, some deductions may come before taxes and others after.<\/p>\n\n\n