six-figures of wealth

Here's what it takes to be in the top 1 percent of earners in Texas

Don't mind us dreaming about six-figure salaries.

It's always been said that the richer get richer as the years go on, and those who hold the most wealth are certainly making that phrase a reality in America. More than a third of the overall wealth in the United States is held by the top one percent of earners, who make about $652,657 a year.

But how much money does a Texan need to make to secure a place in the top one percent of earners in the state? A new study from SmartAsset, published July 17, determined that the answer is not too far off from the national amount, but is still well into the six-digit figure range: $631,849.

SmartAsset looked into what it takes for earners in every state to be considered in the top one percent, and Texas has the No. 14 highest threshold of income needed for the exclusive classification.

Texas' latest ranking is a four-place drop from an earlier SmartAsset report, from February 2023, that put Texas' one percent threshold at $641,400. SmartAsset typically publishes this report annually, but released an all-new report in July when new data from the IRS became available.

The new report further revealed that Southern states have the lowest income thresholds, with six out of the bottom 10 states being located in the Southeast.

"While Northeastern states like Massachusetts and New Jersey have some of the highest income thresholds for the one percent, it takes considerably less income to be considered in the top one percent in many Southern states," the study says.

However, holding on to that much wealth isn't without financial responsibility. Texans who are in that top one percent category have a tax rate of 25.83 percent.

The top 10 states with the highest thresholds to be considered in the top one percent of earners in the U.S. are:

No. 1 – Connecticut ($952,902)
No. 2 – Massachusetts ($903,401)
No. 3 – California ($844,266)
No. 4 – New Jersey ($817,346)
No. 5 – Washington ($804,853)
No. 6 – New York ($776,662)
No. 7 – Colorado ($709,092)
No. 8 – Florida ($694,987)
No. 9 – Illinois ($660,810)
No. 10 – New Hampshire ($659,037)

To determine the different income thresholds for every state, SmartAsset used 2020 data from the IRS and adjusted the numbers to be accurate for May 2023 using the U.S. city average series from the Bureau of Labor Statistics' Consumer Price Index for All Urban Consumers.

The full report can be found on smartasset.com.

SmartAsset Top 1% Earners finance reports texas

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