Distribution of Income by Source in 2009

Investment income (mostly dividends and capital gains taxed at a rate of 15% , and interest), is 60% of the income of the wealthiest taxpayers, according to IRS data for 2009. Business income is about 20%. Salaries and wages are about 20%. Other sources of income are insignificant for the wealthiest as a group.

Salaries and wages, taxed at rates up to 33%, are over half the income of people with incomes less than $500,000 per year. Other important sources for these taxpayers are Social Security, pensions and annuities, and business income.


Favorable Taxation for the Wealthy in 2009

The United States Internal Revenue Service has released 2009 tax statistics for individuals. Persons with incomes greater than $10 million pay income tax at a lower rate (22%) than those earning between $500,000 and $10 million (24% to 26%). Also, those with incomes less than $5,000 pay a higher rate (5%) than those with incomes between $5,000 and $25,000. Patterns of taxation in 2009 were similar to 2008.