Newspaper article THE JOURNAL RECORD

The Rich Are Different

Newspaper article THE JOURNAL RECORD

The Rich Are Different

Article excerpt

As Ernest Hemingway noted, "The rich are different from you and me ... they have more money."

But how do they get it? And do they pay their fair share of taxes? Inquiring minds want to know.

Perhaps that's why Congress, in the Tax Reform Act of 1976, required the Internal Revenue Service to keep track of taxpayers who make $200,000 a year or more.

A lot of money back in 1976, $200,000 a year is still a chunk of change. Heck, it's still more than the "measly" $150,000 a year that we pay members of Congress. (At this writing, members of Congress are fighting about whether to give themselves a $5,000 raise.)

Anyway, since 1977, the IRS has been dutifully keeping track of taxpayers who make $200,000 a year or more. And the IRS pays special attention to the number of such returns reporting no income tax liability and to the importance of various tax provisions in making those returns nontaxable. It seems that Congress is particularly upset that there are people who make more than they do and pay no taxes.

The latest information from the IRS Statistics of Income Division tells us about high-income tax returns for 1999. Altogether more than 127 million returns were filed in 1999, and 2.4 million of them reported income of $200,000 or more (1.9 percent). That year, 93 million of us reported less than $50,000 of income, 24.6 million reported income between $50,000 and $100,000, and 7.1 million reported income between $100,000 and $200,000.

Since 1977, the number of returns reporting income of $200,000 or more has increased dramatically -- from 53,000 in 1977 to 2.4 million in 1999. That's 45.5 times as many high-income returns in 1999 as in 1977. And even ignoring inflation, there are more high- income taxpayers than ever. Measured in 1976 constant dollars, the number of high-income returns for 1999 was still 9. …

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