Most people pay payroll taxes (for social security and medicare)that total about 7% if they are employees and 14% if they are contractors. Federal income tax is on top of that.  As someone who was self employed for most of my working life, I  paid at least 14% even when I only earned about $30,000 a year and supported a family of 4. This tax is not collected on passive income like rents, interest and capital gains.