IRS Released Income Thresholds for Top 1% of Filers

New data reveals that the national income threshold to reach the top 1% of earners rose to $748,000 in 2023.

Updated on Oct. 10, 2026 in Taxes

Bold flat-color editorial illustration of a solitary, oversized golden envelope standing in a vast empty field, symbolizing federal income thresholds. — The IRS reported that the national income threshold to reach the top 1% of tax filers rose to $748,000 for the 2023 tax year. AI Illustration. Upload story photo >

Live Poll

Do you feel the income threshold for the top 1% reflects your actual cost of living?

The IRS released updated Statistics of Income data in August 2026, showing that the national income threshold for the top 1% of tax filers reached $748,000 for the 2023 tax year. This represents a 1% increase in the threshold compared to 2022.

Why it matters

While the threshold for entering the top 1% climbed nominally, it failed to keep pace with the roughly 4% rise in consumer prices observed during the same period. This suggests that in inflation-adjusted terms, the barrier for entry into this income bracket actually declined by about 3%.

Nationally, 1.5 million tax returns qualified for the top 1% category, collectively accounting for 20.6% of total adjusted gross income. Wages and salaries represent 35% of this group's income, while net capital gains contribute 22%.

The players

Internal Revenue Service

This federal agency is responsible for collecting taxes and administering the Internal Revenue Code within the United States.

The details

The data highlights a significant geographic disparity in wealth, with Washington, D.C. reporting the highest threshold at $1.1 million and West Virginia the lowest at $426,000. These figures, processed after the 2023 tax filing season, provide a detailed look at the concentration of adjusted gross income across the country.

The income threshold data reflects tax returns processed for the 2023 tax year.
The IRS released the final Statistics of Income report in August 2026.

Market Dynamics

This release provides a historical baseline for wealth distribution that follows a pattern set by the IRS Statistics of Income percentile tables. It offers a standardized view of how personal income thresholds shift in response to broader macroeconomic cycles.

For the average earner, these thresholds help benchmark relative income levels against national high-earner statistics. Retail investors may use this data to better understand the concentration of capital gains, which currently represent 22% of income for the top 1%.

The takeaway

The gap between nominal income growth and inflation highlights how purchasing power remains a critical factor even for the highest earners. Readers should note that wealth concentration is heavily influenced by non-wage income, particularly capital gains.