by Sarah Curry
Director of Fiscal Policy Studies
The weather is getting warmer, the plants are in bloom and people are starting to spend more time outside. Yes, it’s springtime and as we get more comfortable with the season change, one thing continues to put a damper on things, tax day. April 15th will be here before you know it, but do you know exactly how long it took you to pay for those taxes? If we broke down every tax you have to pay, federal, state, property, etc. how long would it take? What is the cost of government in the terms of a calendar? The day when you have earned enough money to pay your total tax bill for the year has earned the coined phrase, Tax Freedom Day.
According to the Tax Foundation, North Carolina taxpayers will experience their Tax Freedom Day on April 14th, four days later than last year. Here are our neighboring states:
According to the Tax Foundation’s research:
In 2014, Americans will pay $3.0 trillion in federal taxes and $1.5 trillion in state taxes, for a total tax bill of $4.5 trillion, or 30.2 percent of income. The latest ever Tax Freedom Day was May 1, 2000, meaning Americans paid 33.0 percent of their total income in taxes. A century earlier, in 1900, Americans paid only 5.9 percent of their income in taxes, meaning Tax Freedom Day came on January 22.
Since 2002, federal expenses have exceeded federal revenues, with the budget deficit exceeding $1 trillion annually from 2009 to 2012 and over $800 billion in 2013. In 2014, the deficit will continue to decline to $636 billion. If we include this annual federal borrowing, which represents future taxes owed, Tax Freedom Day would occur on May 6, 15 days later. The latest ever deficit-inclusive Tax Freedom Day occurred during World War II on May 21, 1945.
If you want to read more about Tax Freedom Day in America for 2014, click here for the Tax Foundation’s full report.