DAYTON, OHIO: The number of wealthy taxpayers in Ohio is on the way back up after a decline during the recession, according to a newspaper analysis of state tax information.
Nearly 6,300 taxpayers who lived in Ohio in 2011 made more than $1 million, the Dayton Daily News found. That’s up 40 percent from 2009, the worst year of the recession.
The number of wealthy taxpayers did not return to pre-recession levels in 2011, but experts say the group is expanding because of the improving economy and rising stock market.
“It’s gone up because the really wealthy get a much larger share of their income from investments as opposed to labor,” Miami University economics professor William Even told the newspaper.
The million-dollar earners account for 0.1 percent of Ohio’s resident taxpayers.
By contrast, the numbers from the Ohio Department of Taxation showed more than seven in 10 taxpayers in the state earned $60,000 or less in 2011. Another quarter of tax filers earned $60,000 to $175,000.
The number of wealthy taxpayers decreased 12 percent in 2008 and 35 percent in 2009 due the Great Recession. Ohio’s overall tax base slipped 3 percent in both of those years.
The economy started recovering in June 2009, and the stock market picked up momentum in 2010 and 2011. Experts said the gains in the stock market played a significant role in increasing the number of high-income taxpayers, because the wealthy are much more heavily invested in the financial markets.
The tax numbers are “indicative of the volatility in incomes for the high-income taxpayers, because much of their income tends to come from investments, capital gains, dividends and business income,” said Scott Hodge, president of the Tax Foundation, a Washington, D.C.,-based think tank.
In fact, Hodge said, the top 0.1 percent of income earners is a constantly changing group because the incomes of the wealthy often fluctuate from year to year.
Even said the increasing number of wealthy Ohioans is a good sign.
“This is good news for Ohio,” he said. “The rich are paying more in taxes, they are out buying more, and many are business owners . and if Ohio businesses are doing better and are more profitable, that is a good signal for future hiring.”