Wealthy Californians Keep Paying More in Taxes

business man waiting for train

 

The tax numbers are in for the state of California and all signs point to the wealthy paying more than their fair share. With tax day now behind us it’s a key time to take a closer look into the real numbers in the Golden state, especially since income taxes account for more than 65 percent of the state’s revenue in the current budget year.

According to the latest number from the Franchise Tax Board, almost 90 percent of that tax revenue comes from just 20 percent of the taxpayers; those who make $91,000 or more. Taxpayers in that income range are the only taxpayers who have seen an average income increase during the past two years.

Meantime, the top 1 percent of taxpayers, those with an adjusted gross income of at least $501,000 paid close to half – 45 percent – of all state income tax revenue. Taxpayers in this bracket reported an average AGI of $1.6 million in 2013, which is nearly double the amount of the average AGI in 1994. Meanwhile, all other income brackets have seen a decline in their average AGI.

So what does all this mean for the state budget? The governor’s spending plan now expects that income tax revenue will be higher than what lawmakers originally expected when they passed the budget last year. However, that is not due to overall income growth, but rather because they expect higher-income taxpayers to see their income increase even more, which means they will pay higher marginal tax rates.

Posted in

Business Valuation Terms Explained “DLOCK” Vs “MID”

The Discount for Lack of Control (DLOC) vs. The Minority Interest Discount (MID) The Business Valuation Glossary provides these definitions of two similar terms: Discount for Lack of Control – an amount or percentage deducted from the pro rata share of value of 100% of an equity interest in a business to reflect the absence…

The “My Path” Book is now available on Amazon! 

Dear American Dreams Show Subscribers,   “My Path” is now available on Amazon!  We are excited and proud to announce that after a decade of interviewing some of the most interesting and successful business and thought leaders in the world, the American Dreams Show’s Host, Alan Olsen, has published the first book based on a…

Positive Work environment pic 2

Seven Ways to Create a Positive Work Environment

Positive work environments benefit not only the employee but the entire business overall. Here are seven ways to implement a positive work culture. Businesses want their employees to maximize their productivity in the office, which is a no-brainer! To ensure this is possible, employers should start looking at creating a positive work environment for the…

The IRS is Waiving Penalties For Not Filing During Covid, If.... Episode 29, Ron Cohen

Episode 29: The IRS is Waiving Penalties For Not Filing During Covid, If….

If you didn’t file your tax return during covid, …