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Permalink Like Dislike I've created a page to display IRS tax return data by zip code, broken down by adjusted gross income (AGI) class. Here's an example:
http://patrick.net/housing/irs_data.php?zip=94025
It's pretty interesting. It would be even more interesting to correlate it with house prices.
How else can I improve the presentation, or navigation?
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San Jose, CA
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Mick Russom says
Mick,
Living in the fortress increases your kids' chance to be ....... right............. As you've mentioned above.
Why don't you bust your ass to become the right parents and give your kids a chance to meet the right connections and become one of those lucky schmucks instead of whining on the Internet?
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San Jose, CA
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Patrick,
Looks like the top tier's total tax liability over AGI is around 22% while the 2nd top tier's tax liability is 14%.
Interesting that the top tier's passive income (interest & dividend) is over $82k per year. I can live pretty comfortable in the south bay based on that passive income.
The unemployment compensation is very low, less than 2%, across the board. Does this mean 98% of the people are working???
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46 male
Menlo Park, CA
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Good idea, I will add in total tax liability divided by AGI.
I think the low unemployment comp just means that most people who filed returns didn't get much unemployment money.
Now that I look a little more closely, even though capital gains goes up hugely in the top tier, those people still get most of their money on average from wages and salaries.
There is huge wealth in unrealized stock gains that doesn't show up in that chart at all. For example, Sergei Brin lives in Menlo Park, and I bet almost all his Google worth is still in stock that he never sold and so doesn't have to report.
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Low income and welfare don't have to file.
I bet they are not included.
I have no problem with VC.
If someone pays $100 billion for Facebook or $1500 for gold, that is his own problem.
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Belmont, CA
E-man says
Wont work. The SillyCON valley has changed sufficiently to the point with even two good jobs and some modest connections busting your ass is a crap-shoot with terrible odds. And while busting my ass I cant spend time with the kids.
Its times to leave this idiot rat race. Best of luck chasing pie in the sky.
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Boca Raton, FL
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It would be interesting, possibly useful, to see the tax returns graphed on Google Earth. Color the zip codes from brown (dirt-poor) to green (rich, the color of money) based on how rich they are.
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Dan8267 says
BA(sorry,fortress!) will be lush green.
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46 male
Menlo Park, CA
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Good idea. How could I also illustrate a huge inequality of income in a zip code? Menlo Park is like that. There is a very poor part on the east side of highway 101, and it gets richer and richer as you move west on the other side.
Also, how do you shade a whole zip code? I tried to do that once but couldn't find all the boundary data. Maybe Google maps now has zip code boundaries as a feature?
Ah, yes, searching for just 94025 in Google maps does outline the zip code.
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Boca Raton, FL
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Patrick says
Option 1
Use hue to indicate the median income and brightness or saturation to indicate the standard deviation.
Option 2
Use 9 digit zip codes instead of 5 digit ones. The greater resolution will allow for showing huge income gaps in small areas.
Option 3
Use a linear gradient that goes from the min value to the median value to the max value. This would show how the wealth is spread, but the maps would look a bit confusing.
Option 4
Break into the IRS database and get all the individual returns. Then paint each house by it's income. You'll also need to adjust for income hiding by doubling the reported income of registered Republicans.
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46 male
Menlo Park, CA
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Patrick says
OK, done. Last row is total tax liability divided by AGI. And the first row is the % of returns in each income class.
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This is great! Very interesting and indeed gives some insight into particular locale's buying power and real estate prices.
One request: please add median values. The averages in the highest bracket are really skewed up by super earners and you'll always find a few in posh towns.
Thanks!
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Mick Russom says
being at the right place right time has very little to do with living in Los altos, MP or the rest. If buying into LA would give you a bigger chance, than it would follow many from decades pasts would be gods today... clearly not the case if you been here for some time.
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46 male
Menlo Park, CA
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unclemat says
I would love to, but the IRS doesn't publish enough data to do that, at least not in the data set I got from them. They lump people together in groups to protect the privacy of billionaires.
So all I have is the total income reported and the number of tax returns it was reported for. Can't get a median out of that, only an average.
Hmmm, I wonder what Warren Buffett's zip code is. Here it is:
http://patrick.net/housing/irs_data.php?zip=68102
Average income not all that huge.
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I can't believe this! Everyone is paying between 5%-14% while the top tier is paying only 23%!!!! Those rat bastards!
I can only imagine how many loopholes they exploited to get it down to that number: 23% !!! 'Believe that?? A mere 23% while everyone else is paying 5%-14% !!!! Raise their taxes!!! Make 'em pay their fair share!!! Come on... everyone else does!
EAT THE RICH!
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Corning, NY
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Mick Russom says
That's a good idea. Ever read the book of Ecclesiastes in the Bible? Stop "chasing the wind."
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Corning, NY
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Patrick says
Does Buffett live in the city of Omaha itself or in the suburbs?
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housingcasino4865 says
The poor people also pay the 7% Social Security Tax.
The chart only shows >$200k. It includes some poor people who make less than $1 million.
If you look at >$10 million, the tax rate is only 15%.
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You might not think this video has any relevance in your life. Somewhere you just know there is a crazy tax.i. So that being the case I have wonder if this has to do with the concept of the Treasure of Serria madre in some way being thrust upon the common man in some kind of twisted scheme. What I am saying is that the people that run this monetary system just may be on that kind of adventure. Everyone else along for the ride. I'm not saying they are crazy you just might want to consider it.
Aritmus M-16 if it ain't yours don't touch it.
Actually thats Steve the Wonder steering with his knees.
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Patrick says
He sold a billion dollar worth per year.
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46 male
Menlo Park, CA
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Yes, it looks like you're right:
http://biz.yahoo.com/t/27/6414.html
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Founders and employees of new web companies know what happen to those guys of the dot com era. So they sell regularly. Some monies probably went into RE.
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How are all these people only paying 24% taxes over 200k? My husband is a "salaried partner" who works 80 hours per week, and finally got a raise last year after 5 years of building a business to 12 employees including 7 lawyers. All of his raise went to taxes. Not only does the govt take about 44% per paycheck, they asked for another 26k on April 15 which was the money we saved to put toward a downpayment on a house. ALL GONE!! I think we now pay over 50% of our income to taxes. Why even bother working hard??
We have an appt with a new CPA on thursday to see if we can get our tax structure reworked so we can keep more of our money and finally buy a house!!
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Corning, NY
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samsmom says
The solution is to raise the capital gains taxes on ultra high net worth individuals. And to quit getting into endless wars that we can't win.
Eventually we'll need to introduce euthanasia since we won't be able to afford care of all the baby boomers.
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Raising capital gains taxes wont help us. Our taxes will still remain the same or go up too. Once the bush tax credits expire, our taxes will go up another 3%. God only knows what the state will continue to take going forward.
I keep reviewing over and over again how the effective tax rate for over 200k is only 24% in ANY ZIPCODE not just Menlo Park!! It's every single zipcode I plug in regardless of home prices or neighborhood status.
What are we doing wrong? We don't have any income as capital gains because my husband works at a law firm. No stock options or real estate type investments either.
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46 male
Menlo Park, CA
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samsmom says
What you are doing wrong is actually working for a living!
America punishes hard work and rewards merely living off the work of other people.
That's what the ultra-low capital gains tax is all about.
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Long term solution is to cut down government expenditure and subsidy. Increase taxes is short-term and toxic. Can businesses increase prices whenever they like? No, they have to cut costs, improve efficiencies and think out of the box.
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Corning, NY
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Patrick says
That's what America is all about! How dare you question those All-American values. Slavery, genocide, and exploitation...that's what made America the Greatest Country in the World (tm)!
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xenogear3 says
Someone who makes $200K a year and has over a million in assets is a "millionaire". Isn't that who you want to raise taxes on? If it's 10-millonaires and over then why don't you socialists say it from the start? Most millionaires that I know are paying far more than 23% in taxes.
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samsmom says
The reason it's showing 23% is probably because of deductions like real estate depreciation for investment properties. Sadly, it's only a temporary tax reduction because when you sell, all that depreciation is "recaptured". So their real tax rates are higher.
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You cannot tell the actual percentage in taxes by looking at 1040.
"Look Around the Poker Table; If You Can’t See the Sucker, You’re It !"
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wthrfrk80 says
Here we go with the capital gains tax. Do any of you realize that much, and in some cases all of the capital gains are inflation?
You buy shares for $100,000
18.5 years later you sell at $200,000
With the historical annual rate of inflation of 3.5%, over those 18.5 years your purchasing power is reduced by 50%.
Net gain in real terms = $0.00
In nominal terms = $100,000
Now you pay a tax of $15,000!?
With this type of investment you lose 7.5% of your purchasing power. Better than losing 50%, but still, you lose.
And people want to raise capital gains taxes!???
Do you not realize this is a game the government plays: wealth confiscation through inflation?
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Corning, NY
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housingcasino4865 says
Oh I'm fully aware of that, yes. Inflation is a nefarious, hidden tax.
Let's say I buy gold or stock or whatever...and it's nominal value increases...but not faster than inflation. In other words, its REAL value stays the same. But the gummint considers it a "capital gain." Hah! So they get to tax it.
God Bless America.
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Wheeling, WV
Could you add a line showing the average number of dependents (per tax return)? It would be interesting to see how it varies with income - I've seen articles claim it goes up with income, and other articles claim it goes down with income.
Also, can you think of a way to compare zip codes? I'd like to see how my zip compares with others.
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Scottsdale, AZ
Patrick says
Actually, that's not normally taxed as ordinary income -- not sure it would show up on that stat.
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Scottsdale, AZ
wthrfrk80 says
No. Sorry. Not a solution. At all.
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Scottsdale, AZ
People need to stop looking at the overall percentage of high income earners in only one manner. Right now all people see is HEY HOW DID HE PAY ONLY 15% OVERALL TAXES! OMG OMG OMG OMG?
Well, there's lots of reasons. The tax code is incredibly complex and unless you understand his individual situation, you have no right to judge. There could have been passive deductions that came from a sale of an asset, non-ordinary income, capital gains income, etc.
The overall percentage is almost a useless figure.
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46 male
Menlo Park, CA
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GUAB says
It's taxed as capital gains, so it shows up on your 1040, even if the rate on it is only 15%.
Of course at the very high end, people like Steve Jobs, Mark Zuckerberg, and Larry Ellison don't even pay the 15%. They just borrow against their stock, and never sell. Then when they die, like Steve did, their heirs inherit the stock COMPLETELY TAX FREE.
That's because the cost basis resets on their death. So their heirs technically have no gain.
This is an excellent example of how our tax code has been thoroughly corrupted by the very rich.
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46 male
Menlo Park, CA
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chemechie says
Average number of dependents per return is line number 6.
Not sure how I would compare two zip codes. Just do a difference of all the fields?
I could probably add in national percentiles for things pretty easily.
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GUAB says
That is exactly the problem, and "complex" is an understatement. This is a game and a complete clusterf*ck. Efficient tax systems are supposed to minimize the number of factors, such as using a person's income, their consumption of market goods, or passage/participation (bridges, markets, tolls, etc). Our political climate seek to maximize the number of factors of the tax code. They tack on every single loophole imaginable: Deductions, credits, exemptions, deferred write-offs.... these all are insidious financial caveats, subsidies, corporate/lobbyist financial game-rigging, and social engineering.
It is an enormous wast of money and resources. The cost of non-discretionary expenditures exceeded $1t in 2011, more than any other discretionary spending we, even more than defense spending. It's nearly double (in real dollars) what it cost 30 years ago. That's just for individual filers, corporation taxation loopholes are another horrible beast which needs to be slayed. Our govt revenue authority is giving back one dollar for every two dollars it takes in. It sort of defies the whole purpose of having a tax collection department, doesn't it? Treasury Dept acts is like a Blackjack dealer than a revenue management agency.
I can't think of any good reason not to get rid of every single provision in the tax code and lower the tax rates. None. We could lower taxes below the rate for capital gains. Effective rates = actual rates, no more b.s. about the rich dodging the system, etc. Plus, a lot of that loophole outflow money goes to wealthy foreigners and unpatriotic Americans who cheat the system, live abroad or have an army of lawyers/accounts covering them, and are not accountable. We could close an enormous gap in our deficit just by cutting off that outflow, and it wouldn't impact legit investments or the economy. And as for the hundreds of thousands of govt/attorney/accountant jobs serving this system, they can apply their math skills in many better places and industries; no reason to preserve the status quo for their convenience IMO.
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Welcome back klarek.