Methodology on 2023 United States Household Income BracketsĪs I went to press, the CPI99 adjustments from IPUMS appeared off, so I am using the FRED average of $100 in 1999 = $175.70 in 2023 dollars. Make sure you visit these geographic income calculators: Of course, a lot boils down to your location. This measure of middle class uses the range from half of median household income to twice the median household income. In 2023, middle class encompasses household income from $37,101 to $148,404. What is considered a middle class income? This data is adjusted for CPI-measured inflation. To read the chart: a dollar amount is the "threshold" between brackets – more income goes in the higher percentile, less in the lower. (The data is not longitudinal – it is not necessarily the same households in each bracket between years). That means percentage changes of under +8.06% in a percentile would mean lower purchasing power. This data is not inflation adjusted.See the methodology section for my adjustment, but the annual average inflation adjustment is 8.06%. so below, find every household income percentile in 2023. While those statistics are nice, there's no replacement for a more complete view of the US income distribution. Household Income Percentiles for the United States in 2023 Other income (find this list of all components).Household income is defined as all income earned in the household: See our household income by year post for details. Household real median income wasn't this low since 2019, while real average household income also wasn't this low since 2019. Across the board percentiles fell once you adjust for the large amounts of inflation between 20. This section is adjusted for inflation – unlike the sections above.Īcross percentiles, it was a bad year for household income percentiles. Selected United States Household Income Percentiles for 20 $570,003 was the non-inflation-adjusted threshold in 2022. To be in the top 1% in 2023, a household needed to earn $591,550. The average household income was $106,270.90 in 2023. This is up from $70,181 in 2022 (unadjusted for inflation – see below). In 2023, $74,202 was the median household income in the United States. These next three sections are unadjusted for inflation. Average income is influenced by very high earners, although it is also a decent estimate. Medians are resistant to outliers, and better represent a "typical" household. ![]() Median household income is the most important statistic. The most important – or, at least, most closely watched – income statistics are: (The Gini coefficient is a standard measure of income inequality that summarizes an entire distribution in a single number that ranges from zero to one.) The degree to which transfers and taxes reduced income inequality increased over that same period.We also have research on individual incomes and incomes by age. Income Inequality. Income inequality, as measured by the Gini coefficients for income both before and after transfers and taxes, rose between 19.Average federal tax rates fell between 19 across the income distribution, with the sharpest decline in the lowest quintile. Federal Taxes. Higher-income households typically paid a higher average federal tax rate than lower-income households.As a percentage of income before transfers and taxes, means-tested transfers rose over the 41-year period, primarily driven by an increase in Medicaid spending. Between 19, households in the lowest quintile received more than half of all means-tested transfers. ![]() ![]()
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