Here's how much you need to earn annually to join the 1% in Massachusetts
BOSTON - The top 1% may seem like an exclusive and unattainable income level for most Americans, but joining the ranks of the nation's highest earners is at least a slightly more achievable goal in some states than others, according to a new SmartAsset report.
Nationally, it takes an annual income of $652,657 to cross the threshold into the so-called 1% level of wealth, SmartAsset calculated, based on data from the IRS and Bureau of Labor Statistics. By comparison, the median U.S. household brings home about $75,000 annually.
But that 1% threshold varies from state to state, ranging from as high as $952,902 in Connecticut to as low as $367,582 in West Virginia, the analysis found. Massachusetts came in second at $903,401 per year. California was third at $844,266.
The top 1% of income earners may be small in number, but they control a greatly disproportionate 21% of the nation's household income, according to the left-leaning Economic Policy Institute. That share has roughly doubled since the 1970s, thanks to rapid income growth among America's top earners and tepid income growth among middle-class workers, data from the Pew Research Center shows.
High earners in the top states like Massachusetts also face some of the nation's steepest effective tax rates, which is the percentage of income paid in federal income taxes, SmartAsset noted. The typical 1% earner in Connecticut pays an effective rate of 28.4%, the highest in the nation.
On the other hand, it takes the least amount of money to join the 1% in Appalachia and the South, where six of the 10 states with the lowest 1% income thresholds are located. It's easiest to enter the 1% crowd in West Virginia, where the threshold is $367,582 — the lowest in the country.
Many Southern states also have the lowest tax rates in the nation. In Arkansas, the effective tax rate for 1 percenters is 21%, the lowest of any state.
The nation's top threshold for entering the 1% isn't actually found in a state, but in Washington, D.C., where the highest earners take home well over $1 million a year.
