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Tax Freedom Day

| February 16, 2017
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Tax Freedom Day® is the day when the nation as a whole has earned enough money to pay its total tax bill for the year. Tax Freedom Day takes all federal, state, and local taxes and divides them by the nation’s income. In 2016, Americans paid $3.34 trillion in federal taxes and $1.64 trillion in state and local taxes, for a total tax bill of $4.99 trillion, or 31 percent of national income. In 2016 Tax Freedom Day fell on April 24th, or 114 days into the year (excluding Leap Day).

So what does this mean to the average U.S. Citizen? The income we earn the first 114 days (31% of the year) of the year goes to pay taxes. This makes the total average effective tax rate 31% of the nation’s income.

Tax Freedom Day varies among the 50 U.S. States. In 2015, Louisiana had the lowest tax burden, earning enough to pay all their tax obligations by April 2. Connecticut had the heaviest tax burden-Tax Freedom Day arrived May 13. Idaho was ranked 16th with Tax Freedom Day on April 15.

Tax Freedom Day for 2017 is April 9, 2017.

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