Income Tax Statistics

Taxes are stressful for everyone. Taxpayers worry that they’ve paid too much by missing key deductions or they’ve paid too little and will face audits and penalties.

Income Tax Stats - Editor’s Choice for 2026

• More than half of Americans feel that they pay the right amount of taxes.
• Around 40% of US households don’t pay federal income taxes.
• Electronically filed tax returns have an error rate of only 1%.
• The top 1% of American taxpayers pay more income taxes than the bottom 90%.
• Tax evasion is projected to cost the United States $696 billion per year as of the latest 2026 IRS estimates.

The federal tax code is more than 10 million words long.

(Tax Foundation)

The tax code consists of two parts: the 2,412,000-word Internal Revenue Code and federal tax regulations that add 7,655,000 words. And that’s not counting the substantial body of tax-related law that goes hand-in-hand with the code.

44% of taxpayers say they worry about the complexity of the tax system.

(Pew Research Center)

Among Americans who earn more than $100,000, 55% said they found the tax system too complex. Concern dropped to 33% among those who earned $30,000 or less.

72% of low-income Americans don’t know that they are entitled to free tax-filing services.

(United Way)

Most Americans remained unaware of MyFreeTaxes.com, a United Way website that prepares and files taxes for anyone who earns less than $79,000 in 2025. The site handles both state and federal taxes, no matter how complex, free of charge.

Surveys show that half of Americans earning $62,000 or less per year do their own taxes, and 29% pay someone else to do them, or use tax-filing software. Only 40% of respondents knew about the child tax credit, while fewer than six in 10 knew about the earned income tax credit.

Although respondents typically received smaller tax refunds than they were entitled to, half reported that they don’t find tax preparation stressful. Maybe ignorance really is bliss.

Electronically filed tax returns have an error rate of only 1%.

(The Motley Fool)

The data shows that most tax returns are filed electronically. On result is that returns have fewer errors. According to the IRS, the error rate for paper returns is 21%.

75% of American taxpayers expected a tax refund in 2024.

(Credit Karma)

27% of those expected their refunds to be larger than the year before. In the current 2026 filing season, early data shows average refunds have actually increased by roughly 11% to $3,676.

58% of people believe the U.S. Government should completely change the tax system.

(Pew Research Center)

Members of both major parties seem to be in favor of a complete overhaul, except that Republicans want it more (66%) compared to Democrats (48%).

The top 1% of American taxpayers pay more income taxes than the bottom 90%.

(Bloomberg)

The rich pay most of the taxes. Overall, the top 1% of taxpayers contributed 42.3% of the government’s income tax haul.

American families earning less than $100,000 per year have seen their risk of a tax audit risk rise by 17% since 2010.

(Forbes)

In recent years, there’s been a greater number of tax audits for families that are not high earners. At the same time, Americans who earn more than $100,000 saw an 8% reduction in tax audits.

One explanation is that low earners are more likely to prepare their own returns and make innocent errors. Those who earn higher salaries are more likely to have their returns prepared by tax professionals who make fewer errors. However, for 2026, the IRS has shifted focus, aiming to increase audit rates for those earning over $10 million to 16.5%.

Higher earners are more likely to claim the self-employment tax credit.

(Small Business Trends)

The self-employed are subject to taxes that employees don’t pay, but they also enjoy numerous deductions. IRS figures are based on the number of people who take the self-employment tax deduction each year on their tax returns.

It is conceivable that some eligible people choose not to take the deduction and the actual number of self-employed taxpayers is even higher.

72% of tax returns that include income from sole proprietorships, S corporations, LLCs, and partnerships show business income of $100,000 or less.

(Tax Foundation)

Profits of “pass-through” businesses are added to the owner’s tax return as income for purposes of calculating taxes. These businesses contribute only about 14% of U.S. total business income.

In 2026, there were 164 million taxpayers in the United States.

(Tax Foundation)

This is an increase from the 161 million taxpayers recorded in 2023 and 163 million in 2021.

40% of households in America did not pay federal income taxes in 2025.

(Statista)

The same data showed that the share of non-paying households is projected to drop to 37.4% in 2026 as certain provisions shift.

Tax evasion is projected to cost the United States $696 billion per year according to 2026 projections.

(U.S. Internal Revenue Service)

The IRS refers to the lost funds as a tax gap and tries to deal with it through enforcement activities. The amount remaining unpaid after enforcement is estimated at $606 billion.

The IRS spends only 34 cents for every $100 of tax collected.

(U.S. Internal Revenue Service)

The IRS is extremely efficient at collecting tax revenues, according to the most recent data.

53% of Americans feel that they pay the right amount of taxes.

(Pew Research Center)

While more than half of taxpayers believed they were not getting ripped off by the government, 40% felt they were paying too much. About 4% of taxpayers believed they were paying less than their fair share.

The US collected $1.06 trillion in individual income taxes so far in fiscal year 2026.

(FiscalData)

This accounted for 50% of the total tax revenue of $2.10 trillion collected year-to-date as of February 2026.

The average tax refund for the 2026 filing season is currently $3,676.

(CNBC)

This represents a 10.6% increase compared to the $3,167 average seen in 2025.

The IRS has committed to a 0% increase in audit rates for households earning less than $400,000 through 2026.

(IRS Strategic Operating Plan)

The agency is significantly ramping up scrutiny on high-wealth individuals earning over $10 million with a projected 16.5% audit rate. This enforcement shift uses $60 billion in modernization funding to target complex tax avoidance among the ultra-wealthy rather than middle-class filers.

The top 37% tax rate now applies only to single filers with incomes over $640,600 and married couples earning more than $768,700 in 2026.

(Internal Revenue Service)

By pushing these thresholds higher, the IRS prevents bracket creep. This ensures that taxpayers are not pushed into higher tax percentages solely due to inflationary pay raises.