Tip: Mid May. If the government had raised taxes enough to cover federal borrowing, we would have had to work until May 8 just to cover the tax bill.
Source: Tax Foundation, 2015
Taxes are one of the biggest budget items for most taxpayers, yet many have no idea what they’re getting for their money.
In 2015, as in recent years, Americans spent more on taxes than on groceries, clothing, and shelter combined. In fact, we worked until late April just to earn enough money to pay our taxes. So what do all those weeks of work get us?1
Fast Fact: In the Hole. In fiscal 2015, the federal government spent an estimated $468 billion more than it collected in revenue. The government borrows the funds it needs to cover this shortfall by selling Treasury securities and savings bonds.
Source: NPR, January 26, 2015
The accompanying chart breaks down the $3.7 trillion in federal spending for 2015 into major categories. By far, the biggest category is Social Security and income programs, which consume one-third of the budget. This includes Social Security, retirement and disability programs for federal employees, food assistance, and unemployment compensation. Another 16% of the budget goes to defense and related items, and 25% goes to Medicare and health programs.2
Are taxes one of your biggest budget items? Take steps to make sure you’re managing your overall tax bill. Please consult a tax professional for specific information regarding your individual situation.
Pieces of the Federal Pie
Roughly 66% of 2014 federal spending was used for Social Security, Medicare, defense, and related programs.
Source: Center on Budget and Policy Priorities, 2015
- Tax Foundation, 2015
- Center on Budget and Policy Priorities, 2016
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright 2016 FMG Suite.