Do you know what your effective tax rate is? Everyone hears numbers such as 10 percent, 15 percent, 25 percent, etc. thrown around by reporters and pundits, but those numbers usually represent marginal income tax rates. Your effective tax rate is figured by dividing your total tax by your adjusted gross income. MSN Money reports that in 2009 Americans with incomes in the top 25 percent of taxpayers, which includes many middle class families, paid an average effective federal income tax rate of 14.68 percent.

According to a new study released by the Government Accountability Office (GAO) on Monday, in 2010 corporations paid, on average, an effective tax rate of 12.6 percent, far below the 35 percent corporate rate that is set in federal law. Unlike other reports which have used corporate financial statements to determine the effective tax rates paid by those companies, the new study used actual corporate income tax returns from 2010. From the GAO study:

For tax year 2010, profitable Schedule M-3 filers actually paid U.S. federal income taxes amounting to 12.6 percent of the worldwide income that they reported in their financial statements (for those entities included in their tax returns). This tax rate is slightly lower than the 13.1 percent rate based on the current federal tax expenses that they reported in those financial statements; it is significantly lower than the 21 percent effective rate based on actual taxes and taxable income, which itself is well below the top statutory rate of 35 percent. The relatively low federal effective tax rate cannot be explained by income taxes paid to other countries. Even when foreign, state, and local corporate income taxes are included in the numerator, for tax year 2010, profitable Schedule M-3 filers actually paid income taxes amounting to 16.9 percent of their reported worldwide income. [emphasis added]

In a statement, Michigan Senator Carl Levin (D) observed: Some U.S. multinational corporations like to complain about the U.S. 35 percent statutory tax rate, but what they don’t like to admit is that hardly any of them pay anything close to it. The big gap between the U.S. statutory tax rate and what large, profitable U.S. corporations actually pay is due in large part to the unjustified loopholes and gimmicks that riddle our tax code.