According to an IRS report , there were 308.361 returns with adjusted gross incomes of $1 million or more in 2005. California had the most, with 47,366. North Dakota, with just 254 returns in that category, had the least. Of course, there are ways to be wealthy without having income – and one presumes that $1 million goes a bit further in North Dakota than it does in California.
Taxpayers in the top 1% of adjusted gross income reported adjusted gross income of at least $364,657 in tax year 2005. This group accounted for more than one-fifth (21.2%) of all adjusted gross income reported, up 2.2% from the prior year – they also accounted for 39.4% of total income tax reported. That was up 2.5% from 2004.
Taxpayers in the top 5% of adjusted gross income reported adjusted gross income of at least $145,283. This group accounted for 35.7% of all adjusted gross income reported – and more than half (59.7%) of total income tax.
The data was released by the IRS as part of the winter 2008 issue of the Statistics of Income Bulletin , featuring data from 134.4 million individual income tax returns filed for tax year 2005. Of those returns, 90.6 million were “taxable,” meaning that they reported total income tax greater than zero. The number of taxable returns in tax year 2005 was up 1.7% from 2004.
Adjusted gross income on these 90.6 million returns totaled $6.857 trillion, an increase of 9.4% from 2004, and total income tax on these returns totaled $935 billion, up 12.4%. Adjusted gross income is total income, as defined by the tax code, less statutory adjustments, which are primarily business, investment and certain other deductions.
The average tax rate for taxable returns was 13.6% in tax year 2005.