National/World

Where our taxes go

Wednesday, April 15, 2009

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WASHINGTON -- (04/15/09) -- You work all year for it, and then comes April 15th when you settle up the bill with Uncle Sam.

Do you know where your tax money goes?

The price of admission to the most dynamic economy in the world is your federal income tax.

Among other things, the money withheld each week from your paycheck paves roads, provides health care to children, buys tanks and fighter jets and pays the interest on America's mounting debts.

It comes out of every pay check, and when you settle up with the government, you might get a refund or you may owe more.

"Generally, you end up paying more if you have additional income such as consulting fees you might receive or you take on a second job, earn more money or you get a big raise," explained the Tax Policy Center Director Len Burman.

So we thought you'd like to know how exactly how much of your hard-earned money is being spent and where.

The largest portion of the federal budget goes to fund Social Security.

After that comes defense programs, followed by Medicare.

The remaining money supports programs such as food stamps, retirement and disability .

Some of that money goes toward something you'll never see. About eight percent is paying the interest on the country's mounting national debt, which totals more than $11 trillion.

The 2012 projections put it closer to $16 trillion.

"We'll have more spending on interest than we spend on discretionary programs other than defense. That's a lot of money," Burman said.

"Over time the federal interest cost is going to be a serious problem and it really worries tax and budget that worried budget experts in both parties."