Tax Read Time: 2 min

What Do Your Taxes Pay For?

Taxes are one of the biggest budget items for most taxpayers, yet many have no idea what they’re getting for their money.

In 2017, 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

The accompanying chart breaks down the $4 trillion in federal spending for 2017 into major categories. One of the biggest categories is Social Security, which consumes one-fourth of the budget. Income security, which includes food assistance and unemployment compensation, takes another 13%. Defense and related items take 15% of the budget, and 26% 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

More than 60% of 2017 federal spending was used for Social Security, Medicare, defense, and related programs.

Pieces of the Federal Pie

Source: Center on Budget and Policy Priorities, January 29, 2019

  1. Tax Foundation, 2018
  2. Center on Budget and Policy Priorities, January 29, 2019

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 FMG Suite.

Share |
 

Related Content

Fixed or Variable Mortgage, Which Should You Pick?

Fixed or Variable Mortgage, Which Should You Pick?

When selecting a mortgage, one of the most critical choices is between a fixed or variable interest-rate mortgage.

Comparing Mortgage Terms

Comparing Mortgage Terms

Estimate the total cost in today's dollars of various mortgage alternatives.

Funding Your Future Health Care Needs

Funding Your Future Health Care Needs

A little planning now can go a long way to help take care of yourself in the future.

 

Have A Question About This Topic?







Thank you! Oops!

Infographic: Risks at Retirement

Make a plan to take these risks off the table.

Tax-Advantaged Retirement Planning

Reduce your tax liability in retirement.

Buying Auto Insurance For Teen Drivers

Tips on insuring your teen driver.

View all articles

Tax Freedom Day

Assess how many days you'll work to pay your federal tax liability.

Historical Inflation

This calculator shows how inflation over the years has impacted purchasing power.

What Is My Risk Tolerance?

This questionnaire will help determine your tolerance for investment risk.

View all calculators

Managing Your Lifestyle

Using smart management to get more of what you want and free up assets to invest.

Principles of Preserving Wealth

How federal estate taxes work, plus estate management documents and tactics.

5 Smart Investing Strategies

There are some smart strategies that may help you pursue your investment objectives

View all presentations

The Fed and How It Got That Way

Here is a quick history of the Federal Reserve and an overview of what it does.

The Cycle of Investing

Understanding the cycle of investing may help you avoid easy pitfalls.

Investments

You’ve made investments your whole life. Work with us to help make the most of them.

View all videos