ISN'T THAT RICH
Here's the income it takes to live among the top 1 percent in Texas
Wondering how "the other half lives" is so outdated, especially when we we can easily peek into what life is like for the "one percent." A new report from SmartAsset reveals how much money you'll need to be considered the top one percent in Texas.
With Southlake now the richest city in Texas in one study and Frisco named the third wealthiest in America in another report, it's obvious that the North Texas landscape is dotted with pockets of wealth. But how much do you actually need in your pocket to have a top one percent income?
In Texas, an annual income of $641,400 will land you at the top, while $258,400 only gets you to the top five percent.
To come up with those numbers, SmartAsset analyzed 2019 data from IRS tax units and adjusted the figures to 2022 dollars using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the Bureau of Labor Statistics.
For comparison, "the average American household earns a median income of under $70,000," according to the study. And per the latest figures from the U. S. Census Bureau, the median household income in Texas (in 2021 dollars) is $67,321. That leaves plenty of us with a long way to go in our financial striving.
So now we know how we compare to our neighbors, but where does that put the affluent population of Texas in comparison with other states?
For starters, Texas claimed the 10th highest income required to reach top income levels.
The one percent income threshold is hardest to meet in Connecticut ($955,000), Massachusetts ($900,000), New Jersey ($825,965), New York ($817,796), and California ($805,519). Only these five states have thresholds that exceed $800,00, and it's a pretty steep drop down to Texas ($641,400) in 10th place.
The five states where it's easiest to attain one percent status (even though that doesn't seem like good news) are Kentucky ($447,300), Arkansas ($446,276), New Mexico ($418,970), Mississippi ($383,128), and West Virginia ($374,712).
The SmartAsset report also included average tax rates for top earners in each state. There was surprisingly little variance in the top 10 states, with Washington state having the lowest rate (25.02%) and Connecticut collecting the highest tax rate (27.77%).
Texas was in the middle of the pack with a tax rate of 25.71% levied on top one percent incomes.
The 10 states with the highest earnings required to be a one-percenter and their tax rates are:
- Connecticut ($955.3K, Tax rate 27.77%)
- Massachusetts ($896.9K, Tax rate 26.4%)
- New Jersey ($826K, Tax rate 27.36%)
- New York ($817.8K, Tax rate 27.48%)
- California ($805.5K, Tax rate 26.78%)
- Washington ($736.1K, Tax rate 25.02%)
- Colorado ($682.9K, Tax rate 25.24%)
- Florida ($678.8K, Tax rate 25.23%)
- Illinois ($666.2K, Tax rate 26.23%)
- Texas ($641.4K, Tax rate 25.71%)