As Benjamin Franklin so famously put it, “nothing is certain but death and taxes.” Don’t file your taxes and you’ll soon wind up with the IRS calling or knocking at your door. While tax evasion is illegal, tax avoidance is very much legal and permitted, as long as you know where to look, just ask our outgoing President.
If you want to reduce your taxes and save some money in the process, without breaking the law, of course, here’s what you can do to dodge paying taxes and the crazy loopholes other people have used to receive all sorts of deductions.
How much do Americans pay in taxes?
Tax rates mostly depend on someone’s income level. According to the IRS, for the 2017 filing year, the average Americans paid 14.64%. of their earnings in federal income taxes.
- Top 1% of tax filers (higher earners): paid an average of 26.76%
- Bottom half of taxpayers: paid an average of 15.99%
- For all the rest, the average rate varied between 16.69% and 25.92%
Based on a report released by the Bureau of Labor Statistics, Americans contributed $10,771 in taxes on average, excluding state and local taxes. In 2019, the average American paid 29.8% of his income to three taxes—income taxes, Social Security and Medicare.
