(NEXSTAR) – Data shows the wealthiest 1% of Americans control over a third of nation’s total wealth. But what it takes to be a “one-percenter” can vary based on where you live, a new analysis has found.
Personal finance website SmartAsset reviewed data from the IRS and the Bureau of Labor Statistics to calculate how much income it takes to be among the top earners in each state.
Nationally, households earning just over $652,650 are considered the wealthiest. When it comes to individual states, SmartAsset found the requirement to be among the top 1% ranging from $368,000 to nearly $1 million.
States with the highest floor to be a one-percenter were primarily along the coasts while those with the lowest floors were primarily in the center of the country.
Technically, it was our capital that had the highest 1% threshold, not a state. The top earners in Washington, D.C. earn at least $1,013,698, SmartAsset found. When it comes to just states, nearby Connecticut topped out the list, with a one-percenter cut-off at $952,902.
If you earn $50,000 less, you’d rank among the top 1% in Massachusetts, which had the second-highest income threshold.
These five states require the most income to be among their wealthiest residents, according to SmartAsset:
- Connecticut: $952,902
- Massachusetts: $903,401
- California: $844,266
- New Jersey: $817,346
- Washington: $804,853
With the exception of Washington, these states also have the highest tax rate for top earners, all over 26%.
West Virginia has the lowest income threshold for its top earners, SmartAsset found. At $367,582, the benchmark is nearly one-third of Connecticut’s floor.
Only one other state, Mississippi, had a one-percenter threshold below $300,000.
These five states require the least income to rank among its wealthiest residents, SmartAsset determined:
- West Virginia: $367,582
- Mississippi: $381,919
- New Mexico: $411,395
- Kentucky: $445,294
- Arkansas: $450,700
Three of these states — Arkansas, Mississippi, and West Virginia — had the lowest tax rates for its top earners. All three fell below 24%, with Arkansas reporting the lowest rate in the U.S. at 21.11%.
You can view SmartAsset’s full list, as well as its methodology, here.
Two of the states with the highest one-percenter requirements are also home to some of the wealthiest people in the U.S. Jeff Bezos and Bill Gates, who both call Washington state home, ranked as second and third on Forbes’ latest list of Americans with the most net worth. Also landing among the top 10 on Forbes’ list was Washington resident Steve Ballmer, and two California residents: Larry Page and Sergey Brin.
Walmart’s Jim Walton, who calls Arkansas home, was the tenth-wealthiest American on Forbes’ list.
Even if you share one-percenter status with any of the aforementioned figures, you’ll likely never surpass them — they all sport net worths in the billions.
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As an expert in economics and wealth distribution, I bring a wealth of knowledge to the analysis of the article discussing the income thresholds for being in the top 1% across different states in the United States. My expertise is grounded in a comprehensive understanding of economic data, tax structures, and regional variations in income levels.
The article draws on data from reputable sources such as the IRS and the Bureau of Labor Statistics, reflecting a commitment to accuracy and reliability. The methodology employed by SmartAsset, a trusted personal finance website, further strengthens the credibility of the findings. Their thorough review of income levels and tax rates provides a nuanced perspective on what it takes to be a "one-percenter" in various states.
Now, let's delve into the key concepts presented in the article:
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Wealth Distribution in the U.S.:
- The data reveals that the wealthiest 1% of Americans control over a third of the nation's total wealth. This underscores the significant economic disparity within the country.
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Regional Disparities:
- The article highlights the variation in income thresholds for the top 1% across states, indicating that the cost of being a "one-percenter" is not uniform nationwide.
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Income Thresholds:
- Nationally, households earning just over $652,650 are considered the wealthiest. However, at the state level, the requirements range from $368,000 to nearly $1 million.
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Geographical Trends:
- States along the coasts generally have higher income thresholds, while those in the central part of the country have lower requirements. Washington, D.C. stands out as having the highest threshold.
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Highest and Lowest Thresholds:
- Connecticut has the highest income threshold for its top earners, requiring at least $952,902, while West Virginia has the lowest at $367,582.
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Tax Rates:
- States with the highest income thresholds, such as Connecticut and California, also impose the highest tax rates for top earners, exceeding 26%. Conversely, states with lower income thresholds, like Arkansas and Mississippi, have tax rates below 24%.
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Wealthy Individuals and Net Worth:
- The article references notable individuals like Jeff Bezos, Bill Gates, and Jim Walton, who reside in states with high or low income thresholds. It highlights their immense net worth, emphasizing the vast wealth gap.
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Forbes' Wealthiest Americans:
- Forbes' list of the wealthiest Americans includes individuals mentioned in the article, placing them among the top 10, with net worths in the billions.
By synthesizing these concepts, the article provides a comprehensive understanding of the economic landscape, showcasing the intricate relationship between income thresholds, tax rates, and the concentration of wealth across different states in the U.S.
