Keep Factually independent
Whether you agree or disagree with our analysis, these conversations matter for democracy. We don't take money from political groups - even a $5 donation helps us keep it that way.
Fact check: What is the average tax rate for all Americans in the United States?
Executive Summary
The answer depends on what taxes you include: for federal income taxes alone, the IRS reports an average effective rate of 14.5% for tax year 2022, but broader measures that add payroll, employer payroll, and state/local taxes produce substantially higher averages—commonly in the 20–31% range depending on method and year [1] [2] [3]. No single, universally accepted “average tax rate for all Americans” exists in the provided material; definitions and data sources drive the differences [4] [5].
1. Why a single number is elusive — definitions drive the headline
Different analyses answer a different question when asked for the “average tax rate.” Some use federal individual income tax paid divided by adjusted gross income; others add payroll taxes, employer payroll contributions, and state and local taxes; still others look at the entire tax burden on labor or household consumption. The IRS figure cited here — 14.5% — is explicitly an average federal income tax rate for tax year 2022 and does not include payroll or state and local taxes [1]. Organizations measuring tax progressivity or distribution, like ITEP, focus on effective state and local rates and how those rates affect different income groups, which produces very different numbers and emphasizes regressivity for lower-income households [4]. This variance in definitions explains why seemingly contradictory “averages” appear in the record [2].
2. Federal income tax headline: IRS’s 14.5% for 2022
The most direct source in the material is the IRS summary that reports 14.5% as the average income tax rate for 2022, with subgroup averages showing stark differences: the top 1% averaged 26.1%, and the bottom half averaged 3.7% [1]. That metric is precise for what it measures—federal income tax liability relative to adjusted gross income—and is dated to tax year 2022, published in early 2025. The IRS data are descriptive and granular, showing how progressivity functions across income strata; they do not, however, capture payroll taxes, employer-paid taxes, or state and local levies that materially alter a household’s overall tax burden [1] [5].
3. Adding payroll and employer contributions pushes the average higher
Analysts who include payroll taxes and employer payroll contributions find substantially higher effective rates on labor. One study cited in the materials calculates the tax burden on an average single worker (pre-tax income $70,170) at 30.5% total, comprised of 15.9% income tax, 7.1% employee payroll taxes, and 7.5% employer payroll taxes [3]. That tax wedge approach shows how employer-side payroll taxes are an economic cost that reduces net take-home pay even if not withheld directly from gross wages, and it produces a much larger “average” tax burden than federal income tax alone. The choice to include employer payroll taxes or not is a normative one but changes headline averages dramatically [3].
4. State and local taxes change distributional conclusions and averages
State and local tax systems vary and often burden lower-income households more heavily in percentage terms, according to ITEP’s analysis, which reports effective state and local rates of 11.4% for the bottom 20%, 10.5% for the middle 20%, and 7.2% for the top 1% in a national comparison [4]. That pattern means adding state and local taxes to federal obligations raises the overall average for many households and compresses progressivity. The ITEP materials do not produce a single national average for all taxes combined, but they document that state and local levies are regressive on average, which must be factored into any comprehensive average-tax-rate claim [4].
5. Reconciling the numbers — what a fair headline should say
A responsible answer distinguishes measures: “Federal individual income tax only: ~14.5% (2022, IRS).” “Broader tax burden including payroll and employer contributions: ~30.5% for a representative worker in the cited study.” “Combined state/local patterns show regressivity, with effective rates higher for lower-income quintiles.” Presenting a single figure without defining the tax base or time period is misleading. The provided analyses demonstrate that methodology, tax types included, and population definition (all tax filers vs. all residents vs. labor income earners) produce different averages and policy implications [1] [3] [4] [2]. Sources in the dataset vary in scope and purpose: IRS statistics are administrative and narrowly focused; ITEP emphasizes distributional impact; labor-tax studies capture employer-side costs, and each produces a different “average.”