[John Galt]

Originally Posted by st.cronin

From 2005: The Tax Foundation - Number of Americans Outside the Income Tax System Continues to Grow

The 40% number is kind of silly since it counts kids (who obviously aren't earning income and aren't paying taxes). By the Tax Foundation's estimate, 15 million households don't have tax liability (and the Tax Foundation is not exactly a neutral source on this). The unemployed obviously don't pay taxes, but are counted in the number. The number also doesn't include other taxes (FICA, sales tax, etc.). When you look at the IRS's numbers, over 90% of the non-paying households earn less than 20,000 a year. I think it is reasonable that those people don't pay federal income taxes, but maybe I'm just crazy that way.