Only 10% Of Americans Know What They Pay In Taxes

Maybe it’s because I’ve dedicated more than half of my life to elements of financial education that this is so disappointing. Maybe it’s because I painstakingly broke down the tax code into easy to understand pieces when it passed. Maybe it’s just because I’m that guy. But for the life of me, I don’t understand why or how you would work as hard as you do, pay thousands upon thousands of dollars in taxes and not take the time to know your numbers. 

GoBankingRates just completed a study asking tax filers how many tax brackets there are this year. How many knew? As the headline suggests just one in ten Americans and in case you're not aware there are seven rates.

Actually knowing your exact tax rate can be complicated unless you’re only paying out of the lowest tax bracket because of the blended tax rate you pay with a progressive tax system. So, I’m willing to provide a pass on that one but you probably don’t even have a clue to knowing what you’re paying if you haven’t even looked at the rates. 

In case you’re not aware there are seven rates. 10,12,22,24,32,35,37%. If you earn more than $9,525 you’re in more than one. If you touch $500k in income you’ll touch them all. Regardless, knowing your numbers is always a good idea. Uncle Sam’s inclined to take advantage of ignorance.

Photo by: Scott Olson/Getty Images

 

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