Over the past five weeks, we have been discussing tax issues related to wealth management in a series of blogs, part of ThinkAdvisor’s annual 23 Days of Tax Planning Advice: 2016. In this post, we will conclude with a few statistics on how taxes affect many of our clients.
Tax Freedom Day
Each year, it takes a certain number of days for Americans to earn enough money to pay all federal, state and local taxes, reaching what is called Tax Freedom Day. The Tax Foundation assigns each state a ranking of 1-50, where ‘1’ is best (i.e., the fewest number of days to Tax Freedom Day, or TFD) and ‘50’ the worst.
Here are the five best- and worst-ranked states in 2015. Alabama and Tennessee tied for fourth and Connecticut and New Jersey tied for last (i.e., worst).
Who Bears the Income Tax Burden?
Who bears the greatest income tax burden in the United States? Many of our clients.
Taxes consume a significant portion of income for those who have achieved some measure of success. (See Closing Tax ‘Loopholes’ Would Choke the Middle Class.)