Tip: Elvis Era. The last time the federal government had a budget in which it didn’t borrow more money than the prior year was in 1957—under President Eisenhower.
Source: U.S. Treasury, 2011
Taxes are one of the biggest budget items for most taxpayers, yet many have no idea what they’re getting for their money.
For 2011, the Tax Foundation said it expects Americans to spend more on taxes than on groceries, clothing, and
shelter combined.1
And in a recent national survey, Americans were asked a few questions about the federal budget. One question asked, what’s “your hunch about what percentage of the federal budget goes to foreign aid?” The average estimate: 27%. In reality, America spent 1.3% of its 2010 federal budget on international affairs.2
Fast Fact: In the Hole. In fiscal 2010, the federal government spent $1.3 trillion more than it collected in revenue. The government borrows the funds it needs to cover this shortfall by selling Treasury securities and savings bonds.
Source: Congressional Budget Office, 2011
The accompanying chart breaks down the $3.6 trillion federal budget for 2010 into major categories. By far, the biggest category is Social Security and income programs, which consumes well over one-third of the budget. It includes Social Security, retirement and disability programs for federal employees, food assistance, and unemployment compensation. Another 24% budget goes to defense and related items and 23% to Medicare and health programs.3
Are taxes one of your biggest budget items? Take steps to make sure you’re managing your overall tax bill. Please consult a tax professional for specific information regarding your individual situation.
Pieces of the Federal Pie
Roughly 83% of the 2010 Federal budget was used for Social Security, Medicare, defense, and related programs.
Source: Congressional Budget Office, 2011
Itemized Federal Spending
The median household paid $5,729 in federal taxes during 2010. Here’s a breakdown of how the money was spent, according to categories established by the Congressional Budget Office.
- Tax Foundation, 2011
- World Public Opinion, 2010
- Congressional Budget Office, 2011
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG, LLC to provide information on a topic that may be of interest. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright 2011 FMG, LLC