Potential savings for upper-class earners with proposed elimination of federal income tax

From Yahoo Finance: 2025-05-10 07:06:00

President Trump has hinted at the possibility of abolishing federal income tax and replacing it with tariffs. Although experts doubt the feasibility of this plan, Trump continues to consider it. The potential impact on upper-class residents in each state has been calculated, showing significant savings without federal income tax.

The average income of the top 20% in various states ranges from $197,470 to $364,076, with tax burdens between 26.4% and 38.3%. Bi-weekly paychecks with federal taxes range from $5,328 to $9,076, while paychecks without federal taxes could be $7,260 to $13,303.

These calculations shed light on how the proposed elimination of federal income tax could affect the upper class, potentially leading to significant increases in take-home pay for many individuals across different states.

Read more: How Much More Would Upper-Class Earners Make in Each State If Trump Dropped Federal Income Tax?