How the government spends your taxes

John W. Schoen Senior producer • Profile • E-mail

If you haven’t already, you’ll soon sit down and sign your tax return — the annual accounting of what you owe the government. Like many tax filers, you're probably asking yourself: Just where does my money go when the government gets its hands on it?

Alas, it's not as simple a question as it may seem. For those of you who have trouble balancing your checkbook, imagine trying to keep track of where $4.1 trillion goes. That’s what was spent on your behalf at all levels of federal state and local government last year.

Even with armies of accountants and auditors, it’s hard to know with certainty exactly where your taxes ended up. For starters, you pay taxes based on a calendar year; the government spends it based on a fiscal year that begins Oct. 1. Even if the calendars matched up, the journey your tax dollars embark on depends a lot on things like how much you make, how you spend it and where you live.

Still, while the Bush administration tax cuts and the rise of the Alternative Minimum Tax have shifted the burden of who pays what, the size of the average tax bite on all of us hasn’t changed much, according to Gerald Prante, a senior economist Tax Foundation.

“The burden of government overall has remained relatively flat since 1970,” he said.

On average, about two-thirds of your taxes went to Uncle Sam last year and the rest went to your state, county or other local government, according to the folks down at the Commerce Department’s Bureau of Economic Analysis. (We'll use their numbers for this exercise.)

So where did your money go after you sent it off to Tax Heaven? One way to find out is to look at the government's bills. If the government sat down at the kitchen table to try to see where its paycheck went, here’s — very roughly — where it went in 2007.

To make the math a little easier, let’s assume the government made $52,000 a year — or $1,000 a week — which is about the median household income in the U.S. (The real number was $48,200 in 2006. And keep in mind that $1,000 a week doesn’t include taxes. But you’re the government — you don’t pay taxes.)

The biggest government bill last year was for a category called “income security” ($220 of that $1,000 weekly paycheck) — which includes Social Security ($115), along with other social services like welfare ($46), disability payments ($35) and unemployment  insurance ($7). The next biggest chunk went to pay for health care ($203), which includes Medicaid and Medicare.

Keeping our country — and your neighborhood — safe cost almost $200 a week, including national defense ($132), along with spending on “public order and safety” ($65), which included police ($27), prisons ($18), courts ($12) and fighting fires ($8).

Education took the next biggest slice ($158) — most of which went to pay for elementary and secondary schools ($117). Much of the rest helped pay for college ($28). About $2 a week of our $1,000 a week paycheck went to pay for public libraries.

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