U.S. taxpayers had to report at least $675,369 in adjusted gross income in 2022 to make it into the top 1% in terms of taxable income, but a new Internal Revenue Service income table shows they were having a tough year.
The minimum adjusted gross income cutoff for taxpayers in the top 1% fell 3.4% from its 2021 level as the Federal Reserve Board pulled some of the extra cash it had fed into the U.S. economy in 2020 and 2021 out of the money supply. The drop was likely caused by the direct and indirect effects of Fed tightening on the stock market, other investments and the U.S. economy as a whole.
The cutoff for top 1 percenters fell 9.8% in Massachusetts and 13.9% in Washington state.
Meanwhile, the cutoff for making it into the top 50% in terms of income increased 6.9% between 2021 and 2022, to $52,013.
For a look at the 12 states with the highest 2022 AGI cutoffs for top 1 percenters, see the gallery accompanying this article. (Note that we counted the District of Columbia as a state.)
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