STUMP » Articles » What's the Income Percentile for the Obamas? Number-Checking » 26 July 2016, 12:01

Where Stu & MP spout off about everything.

What's the Income Percentile for the Obamas? Number-Checking  


26 July 2016, 12:01

Oh hai other person who goes by one name who has no other way for me to contact!

I see you’ve got some numbers! Let’s take a look!

President Obama and First Lady Michelle Obama released their tax returns again this year, showing how much the couple earned, what tax percentage they paid, and which charities the couple gave to and how much they gave.
‘More than 90 percent of the first couple’s income came from the president’s salary—the same $400,000 the country has paid its commander -in-chief since 2001 (reduced this year by a few thousand dollars for some unstated reason). The president also earned about $56,000 in book royalties and only a few hundred dollars from investments. After subtracting contributions to a retirement plan, a deduction for Medicare tax on the president’s income as an author, and $3,000 of capital losses, the couple’s adjusted gross income (AGI) totaled $436,065.’
Itemized deductions on the couple’s tax return included $48,000 in state and local taxes, $36,000 in mortgage interest, and a whopping $64,000 in personal charitable contributions. Their taxable income after subtracting itemized deductions was $290,640, placing them in the 33rd percentile for income in the United States.

33rd percentile?!

You mean they’re below the median?

Okay, I know everyone says “The 1%!!!1!!1!!1weleventy!!!!” to mean the 99th percentile and above.

So let’s flip that, and therefore clarissa is saying that the Obamas’ $290,640 post-tax income is the 67th percentile of income.

Oh jeez, not even close.


First, let’s look at the complete recent history of the Obamas’ Adjusted Gross Income:

2015: $436,065
2014: $477,383
2013: $481,098
2012: $608,611
2011: $789,674
2010: $1,728,096
2009: $5,505,409

I think the income drop is because Obama started having his book royalties being sent directly to charities or something. I don’t care to dig through the tax returns, because this post is about clarissa’s innumeracy and not about Obama’s business.

Oh look, if you go down to line 37 and click, you get the following pop-up:

I will note that they screwed up the year in the initial text when they updated the page. That’s okay. We all have copy/paste errors. I also noticed a couple other problems. Worry not, I’ll clean up without a [sic]!

Here’s the text if you can’t see pictures:

President and Mrs. Obama had an adjusted gross income (AGI) of $436,065 in 2015.

The Obamas’ AGI of $436,065 in 2015 puts them in the top 1 percent of earners based on 2013 IRS statistics. They would have had to earn $1.9 million to be in the top 0.1 percent.

The first couple’s AGI has declined each year from its peak of $5.5 million in 2009, when they paid a $1.8 million income tax bill. At that time they were in the top 1/10th of 1 percent of taxpayers. The tax they paid in 2009 was more than four times their total 2015 income!

If you want to have a handy tool to check out household income percentiles, you can play with this — the link I see uses 2014 data, but that’s okay. The distribution doesn’t change too much for the 99% lower people year-to-year. It can change more drastically at the extreme percentiles.

Now that’s using Census data, and as the Census doesn’t pull income data from everybody every year, what it really is is one of their household surveys. I use those stats all the time.

Playing with that tool, the income would have to be $81,000 to be in the top 33%.

Oh, and by the way, everybody looks at pre-tax income for these things.

Unless you’re looking at IRS data. Then you can do all sorts of things.

Now, the most recent data I can get is 2013. But we’ve got the Obamas’ 2013 AGI, so we’re good there.

Of the 147 million individual income tax returns in 2013, only 0.7% were for AGIs greater than $500K, and 3.7% were for AGIs greater than 200K. So the percentile (doing it the Social Justice Warrior Way) has to be between 0.7% and 3.7%.

Here’s a graph – I’m using the average from each grouping to provide the AGI level, and that gives one a really lumpy distribution:

Ugh. Let’s do the cumulative distribution, which always looks better because it can only increase:

Underlying spreadsheet is here. Note that I don’t include AGI at the Obamas’ level, because it’s such a high percentile, and it’s not very interesting to look at.

Anyway, I don’t know where the 33rd percentile comes from. Someone posited what was meant was overall taxation rate (which I’m not even bothering checking…but it’s possible).

My other thought is that they were 33rd percentile for the politicians in D.C….. which I totally believe.

But nobody is gonna feel sad that the Obamas are poor compared to the rich pols like Nancy Pelosi and Harry Reid.

Well, maybe the Obamas, but once their younger child graduates high school, they don’t have to hang out with the riff raff anymore. They can hang out with people where they really are the 1%! (and I mean in the proper percentile way).

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