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The IRS Statistics of Income Bulletin for winter 2013 reveals a continuing upward trend in individual adjusted gross income, salaries, and wages.

IRS Stats Show Uptick in Individual Income and Salaries

  • 3/20/2013

IRS Stats Show Uptick in Individual Income and Salaries

The IRS Statistics of Income (SOI) Bulletin for winter 2013 reveals a continuing upward trend in individual adjusted gross income (AGI), salaries and wages, and other items. However, the mortgage interest deduction decreased in tax year 2011 compared to the previous year.

Along with growth in salaries and wages, the bulletin shows an increase in retirement-related items. In 2011, the first baby boomers (individuals born in 1946) turned 65. Social Security benefits increased by 5.3 percent and distributions from individual retirement accounts increased by 12.3 percent in tax year 2011 compared to tax year 2010.

Individual returns

The IRS reports that taxpayers filed 145.6 million individual income tax returns for tax year 2011, representing an increase of 1.9 percent from the previous year. Taxable income increased 4.3 percent to $5.7 trillion, total income tax increased by 9.3 percent to $1 trillion and total tax liability increased by 9.8 percent to $1 trillion.

Taxable unemployment compensation decreased 23.4 percent in tax year 2011 and the number of returns reporting taxable unemployment compensation decreased by 11.9 percent.

Adjusted gross income

AGI increased by 3.1 percent in 2011, the IRS reports. Wages and salaries, the largest component of AGI, increased 4.1 percent from $5.9 billion in tax year 2010 to $6.1 billion in tax year 2011. Taxable pensions and annuities, the second largest component of AGI, increased 4 percent from $567.7 million in tax year 2010 to $590.4 million in tax year 2011.

Deductions

Total deductions (the sum of standard deductions and total itemized deductions) increased 1.5 percent from tax year 2010 to 2011. Approximately 66 percent of returns for tax year 2011 claimed the standard deduction. Taxes paid accounted for the largest deduction, followed by interest paid.

The mortgage interest deduction accounted for $358.8 billion and 96.5 percent of the total interest paid deduction. However, the IRS reported that the mortgage interest deduction decreased 7.3 percent in tax year 2011 compared to 2010; it also attributed an uptick in use of the standard deduction in part to that trend.

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