Tax Lawyer's Blog

There has been a lot of talk lately about the recently issued news that 47% of Americans pay no federal income tax. Now, according to Paul Caron, the Tax Foundation has released a report that breaks down those non payers by state:

One of the most reported topics during the latest tax filing season was the record number of Americans who filed an income tax return but had no income tax liability after taking their credits and deductions.

According to the latest IRS figures for 2008, a record 52 million filers—36 percent of the 143 million who filed a tax return—had no tax liability because their credits and deductions reduced their liability to zero. Indeed, tax credits such as the child tax credit and earned income tax credit have become so generous that a family of four earning up to about $52,000 can expect to have their income tax liability erased entirely.

There are millions of other Americans who have some income but not enough to be required to file a tax return. The Tax Policy Center has estimated that when these people are added to the 52 million nonpaying filers, some 47% of all households pay no income taxes at all.

New data from the IRS allow us to calculate the number of nonpayers in each state who filed a tax return.

Rank	State	% With $0 Tax
1	Mississippi	45%
2	Georgia	41%
3	Arkansas	41%
4	New Mexico	40%
5	Alabama	40%
6	S. Carolina	40%
7	Louisiana	39%
8	Texas	39%
9	Florida	39%
10	Idaho	39%
U.S. Average		36%
41	Virginia	30%
42	Minnesota	30%
43	Washington	29%
44	Maryland	29%
45	N. Dakota	29%
46	Wyoming	28%
47	N. Hampshire	28%
48	Connecticut	27%
49	Massachusetts	27%
50	Alaska	21%

 

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