The Tax Foundation, a nonpartisan tax research group founded 75 years ago, says the average American will work 107 days this year to pay the total tax bill for all Federal, State and local taxes. According to the Tax Foundation, Americans will spend more in taxes this year than the total amount spent on food, clothing and shelter.
Here’s a breakdown of the Federal income tax bill: The average person will work 32 days this year to pay income taxes, 23 days to pay social insurance taxes, nine days to pay corporate taxes, two days to pay sales and excise taxes, and three days to pay all other Federal taxes.
In addition they will work eight days to pay State and local income taxes, 12 days for property taxes, 12 for State sales and excise taxes, and four days for other State and local taxes.
On average a US citizen must work from the beginning of the year until April 17 to pay their tax bill.
If the Federal government raised taxes to help close the budget deficit, Tax Freedom Day would not arrive until May 14, with an additional 27 days of work to pay the IRS.
Claiming Tax Refunds
Knowing the delayed gratification of Tax Freedom Day, does this mean you should work to minimize your tax refund? The answer may surprise you.
The average tax refund sent out by the IRS is about $3,000. Most financial advisors tell you to try to minimize this refund so that you can keep the most amount of money you can in your pocket.
However, the interest are you losing to this tax refund withholding is only about $2.50 per month. And most people would probably spend this money instead of saving the lump sum they receive after tax day.
So don’t worry if you receive a large tax refund check from the IRS, it is your reward for being a good citizen and paying your taxes on time.