Federal data shows top 1% wealth growing in US

The U.S. midterm elections approach under a heavy cloud of voter anxiety over affordability, yet behind that catchphrase lies a deeper, widening chasm of economic inequality. A Pew Research survey released in October 2026 revealed that roughly 6 in 10 Americans—including 4 in 10 Republicans—believe there’s too much inequality in the U.S. A growing share from both major political parties now state that the economy needs to be fundamentally rebuilt to address this.

Translating that widespread public frustration into concrete legislative results has proven remarkably difficult. In California, public backing for a proposed wealth tax on billionaires waned significantly ahead of the midterms. Meanwhile, in 2025, congressional Republicans used narrow majorities to pass sweeping federal legislation that cemented tax cuts for the wealthy while trimming vital safety net programs.

How the Top One Percent Pulls Away From the Rest

Federal data maps a steady climb in wealth concentration that stretches back decades. Between the first and second quarters of 2026 alone, the top 1% saw their share of total national wealth jump from 31.7% to 32.5%, an increase totaling more than $8.5 trillion. That trajectory continues a climb from 30.9% at the close of 2024 and 27.4% in 1999.

These gains accumulate directly at the expense of the American middle class. The middle 40% of households—positioned between the bottom half and the top 10%—now hold just 28.8% of all wealth, despite outnumbering the top 1% by a factor of forty. That middle tier’s share is noticeably diminished from 32.9% in 1999 and 30.2% at the end of 2024, according to the data.

Even within the highest echelons of extreme wealth, the ultra-elite are separating themselves from the merely rich. Those occupying the top 0.1% now own 15% of all American wealth, capturing two-thirds of the gains recorded between the first and second quarters of 2026. Research confirms the trend of rising inequality since 1980, driven by policy shifts enacted over the past forty years.

AI Boom Drives Wealth for the Top 0.1%

The distinct trajectory of the top 0.1% stems largely from their heavy exposure to corporate profits and equity markets. Their asset portfolios have soared on the promise of heightened future profitability, propelled primarily by the artificial intelligence and technology boom. Unlike the rest of the top 1%, whose wealth relies more heavily on real estate, roughly three-quarters of the top 0.1%’s portfolio consists of corporate and business ownership.

This composition allows the ultra-wealthy to use the structure of the tax code to their advantage. Massive stock holdings enable them to borrow cash against their equities tax-free rather than triggering taxable events by selling shares. By contrast, the middle class holds nearly two-thirds of its net worth locked in primary residences and retirement accounts, while direct business ownership accounts for a mere 15%.

Congressional action in 2025 reinforced these structural advantages. Lawmakers made permanent the core pillars of the 2017 tax cuts, securing the lowest corporate tax rate seen since 1940 alongside historically low top-income tax rates. Nonpartisan analysis from the Institute on Taxation and Economic Policy indicates that policy modifications enacted since early 2025 have imposed higher financial burdens on every demographic segment except the top 1%.

Policy Changes Transfer Costs to Middle Income Households

Beyond direct tax code revisions, recent policy changes have quietly transferred various operational costs onto low- and middle-income households. The 2025 federal legislation permitted federal health care subsidies under the Affordable Care Act to lapse. Insurance analysts anticipate that higher premiums and out-of-pocket expenses will cause ACA plan enrollment to drop by roughly 5 million people.

At the same time, volatile energy expenses, including gasoline and heating oil, continue to squeeze working-class budgets while swelling profit margins for extraction and transportation firms. That divergence intensified following the onset of the conflict with Iran in February 2026, which drove global crude prices sharply upward. Tariffs have added another layer of consumption taxes on imported goods. Federal Reserve economists in New York calculated that without these import levies, common consumer goods prices would have fallen by 1% over the year instead of climbing by 2.9%.

Federal data illustrates how rapidly these shifting financial pressures redistribute stability from the middle class upward. As economists note, these outcomes reflect deliberate political and historical choices rather than inevitable economic laws.

More on this story: Average net worth for Americans over 60 hits 1.96M in 2025