Tax burden on Utah’s imaginary family — almost 25%

Apr 19, 2022, 12:26 PM

a tax form, 1040, is often used to file taxes...

Tax day is April 18, 2023. (Photo credit: Getty Images.)

(Photo credit: Getty Images.)

SALT LAKE CITY — The Utah Taxpayers Association created an imaginary family — Bob and Brooke Beehive and their three kids –to look at the tax burden a typical family in Utah would pay.

Their annual tax burden report shows Social Security and Medicare payroll taxes are by far the largest part of the tax burden, while state sales and income taxes also make up a significant share.

With help from child tax credits and exemptions, the Beehives would receive a federal tax refund of $2,321 on an adjusted gross income of $84,089 — somewhat higher than Utah’s median income as reported by the U.S. Census Bureau of $74,197.

Taxpayers Association President Rusty Cannon said the burden of federal payroll taxes is something many Utahns may not think about.

“The one thing that we hope this report shows that most people might not know is the massive amount of payroll and Social Security taxes everybody pays, and this is a federal conversation,” Cannon told KSL NewsRadio. 

While most people see half of the payroll taxes deducted on their pay stubs, Cannon said they’ve accounted for the full amount.

“You’re paying it. It’s just being remitted by your employer to the government, and so it’s an indirect tax that we think definitely needs to be measured and part of the calculation,” Cannon said.

Looking at the last legislative session, Cannon said lawmakers enacted a small cut in the state’s income tax, dropping the rate from 4.95% to 4.85%. But he said some neighboring states are being much more aggressive about tax cuts.

“We’ve got several neighbors — Arizona just went to two-and-a-half percent. Nevada’s zero. Wyoming’s zero. Idaho just cut theirs by a half-a-percent,” he said.

Cannon said Utah’s efforts at water conservation could also help lower the tax burden. As providers move away from property tax subsidies for water to a system based on user fees.

Related: What the delay in receiving a tax refund this year will mean for Utahns


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Tax burden on Utah’s imaginary family — almost 25%