How Many People Make Over 1 Million a Year?
Uncover the rare prevalence of million-dollar earners in the U.S., including what defines such income and who these individuals are.
Earning an annual income exceeding $1 million remains an uncommon achievement within the overall U.S. population. Understanding the prevalence of high-income earners provides insight into the economic landscape.
Prevalence of Million-Dollar Earners
A relatively small segment of the population earns over $1 million annually. Data from the Internal Revenue Service (IRS) for 2022 indicates that approximately 800,000 taxpayers reported an adjusted gross income (AGI) of $1 million or more. This figure represents a minor fraction, roughly 0.5%, of the 153 million income tax returns filed during that year.
Despite this growth, the proportion of individuals earning over $1 million remains consistently below 1% of all taxpayers. For instance, recent IRS filing statistics from May 2024 show that only about 0.22% of filed returns reported an income of $1 million or more. This demonstrates that while the number of high earners has expanded, it continues to be a distinct group within the broader economic framework.
Defining Million-Dollar Income
When discussing million-dollar incomes, the term “income” typically refers to Adjusted Gross Income (AGI), which is a key metric used by the IRS. AGI is calculated by taking an individual’s total gross income and subtracting specific allowable deductions.
Gross income itself encompasses various sources of earnings. This includes wages, salaries, and tips, along with income derived from businesses, investments such as interest, dividends, and capital gains, and rental properties. It generally excludes certain non-taxable receipts, such as specific inheritances or life insurance payouts. The IRS is the primary source for this income data, gathered from filed tax returns.
Differences in reported figures can arise from varying methodologies across data collection agencies. For example, some statistics may focus on individual income, while others might consider household income, which can include earnings from multiple individuals within a single household. Understanding these definitions provides important context for interpreting high-income statistics.
Demographics of High-Income Earners
Individuals earning over $1 million annually often share several demographic characteristics. Age plays a significant role, with many high earners typically falling within the 45 to 64 age bracket, which corresponds with peak career earning potential. Educational attainment is also a consistent factor, as higher levels of education, particularly bachelor’s, master’s, and professional degrees, are strongly associated with increased income levels.
Certain industries and professions are more commonly linked to these high earning levels. Financial services, technology, and real estate are frequently cited sectors that generate a substantial number of high-income individuals. Within these industries, specific roles such as engineers, accountants, and medical professionals like doctors are often noted for their high earning potential. These professions typically offer paths to significant financial accumulation.
Geographical concentration is another notable characteristic, with a higher density of million-dollar earners found in specific regions. Coastal states, particularly those in the Northeast and on the West Coast, tend to have a larger proportion of these high-income taxpayers. This concentration often reflects the presence of major financial centers, technology hubs, and other high-value industries in these areas.