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Definitions of “rich” differ from consumer to consumer and advisor to advisor. Most Individuals suppose it takes a web price of round $2 million to be rich, in keeping with a Schwab survey.

The Inner Income Service defines rich people utilizing the property tax threshold, calling this group “high wealthholders.” In 2019, the latest 12 months for which information is on the market, the edge was $11.4 million.

The most recent figures obtainable present that the variety of taxpayers who appeared wealthy to the IRS ranged from simply 8 per 100,000 residents in West Virginia to greater than 100 per 100,000 residents in two states.

See the accompanying gallery for a take a look at the 12 states with the best variety of high wealthholders per 100,000 residents. See the desk under for high wealthholder information for all 50 states and the District of Columbia.

What it means: The IRS wealth tables could present some shocking clues about the place individuals who want large life insurance coverage insurance policies and high-end planning providers stay, or not less than what these taxpayers inform the IRS about the place they stay.

The numbers: The IRS publishes detailed statistics on wealthholders each three years. The company will get the info by reviewing property and generation-skipping switch tax returns. It updates the minimal quantity of gross belongings to be included within the ‘high wealthholder’ class to correspond to will increase within the dimension of the property tax exemption for a person.

For the 2016 tables, for instance, which mirrored tax returns filed earlier than the Tax Cuts and Jobs Act of 2017 property tax exemption improve took impact, the cutoff was $5.45 million. The 2024 property tax exemption is $13.6 million.

One of many IRS tables offers details about high wealthholders by state of residence.

The IRS leaves the fields for 2 states, Alaska and Rhode Island, clean as a result of as a result of the highest wealthholder counts there are so low that together with the numbers may reveal details about particular taxpayers.

To regulate the numbers for state inhabitants dimension, we divided the IRS high wealthholder depend estimates by the Census Bureau’s 2023 state inhabitants estimates, after which multiplied these outcomes by 100,000 to specific the figures by way of variety of high wealthholders per 100,000 residents.

One purpose for a number of the extra shocking outcomes may very well be issues with the strategies the IRS makes use of to develop the estimates, and particularly how these strategies work for low-population states.

Another excuse for astonishing rankings may very well be tax planning methods: 4 of the highest 5 states within the gallery (those with out the Empire State Constructing in them) are recognized for not having state property taxes or state inheritance taxes.

Credit score: denisismagilov/Adobe Inventory

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