Half of Americans pay no federal income tax - Tax Tactics - msnbc.com

MSNBC reports nearly half of Americans or 47% to be exact pay no taxes. They either have too low of an income or qualify for enough credits, deductions and exemptions to eliminate their liability.

The Atlantic wrote an interesting article here which discusses whether it is fair that nearly half the country does not pay taxes and thus does not contribute to paying for the discretionary budget. While it points out that is not really fair it then also points out that the upper income people have received the largest share of income gains in the 2000's with the top 1% soaking up 2/3 of the gains of pre tax dollars and that their income is the highest it has been proportionally since the 1920s. The article mentions that the top 20% of the country generates 67% of the revenue for the country. The top 1% is responsible for 23%.

It also mentions how when Ronald Reagan Reagan left office in 1988 that the top 10, 5 and 1% of the income bracket were paying effective tax rates of 27, 28 and 30% on their incomes while in 2009 those groups were paying 22%, 23% and 26% so their tax rates along with the rest of the country had fallen along with the rates for those with lower incomes.

That along with the fundamental way the tax system is currently set up and the skyrocketing deficit the government is facing will force significant changes and higher tax rates.