![]() ![]() The 26 billionaires paid an average effective tax rate of just 18.2% on their reported income- far below the top statutory tax rate of 39.6% in effect for all but one of the six years and closer to the average 13.3% rate paid by Americans of all income levels in 2019. Elon Musk paid a mere 2.1% tax rate.Īs highlighted by ProPublica in its report this year, the ultrawealthy pay a remarkably low tax rate even on their sources of income that are now taxed. Notable names that paid less than a 2% tax rate based on their wealth growth include: Warren Buffett (0.1%), Jeff Bezos (1.1%), Mark Zuckerberg (1.1%), Charles and David Koch (1.3% and 1.4%, respectively), and Michael Bloomberg (1.8% ). So including the increased value of unsold assets when figuring the share of income paid in federal income taxes provides what ProPublica in a separate report last year dubbed a “true tax rate.” That report identified six billionaires paying no taxes some years or very low tax rates-this ATF analysis expands the list to 26. Among their other advantages, those gains can be used to secure low-interest loans that fund lavish lifestyles without owing income tax. Īt the scale enjoyed by billionaires, growth in the value of assets-even if those assets are not sold-can be as good as money in the bank, which Elon Musk is putting to good effect in his purchase of Twitter. As is usual among the ultra-wealthy, that taxable income-in this case, $132.2 billion-is far smaller than their leap in fortunes. The taxes paid were not based on wealth growth, which under current law is not taxed, but rather on “taxable income”: wages, private business earnings, dividends, interest, profits from the sale of stocks and other investments, and other sources. The 26 billionaires’ collective wealth grew by $500 billion between 20 while their total federal income taxes were just $24 billion. This revelation underscores the need to tax billionaires and other ultra-wealthy Americans more effectively, as proposed in plans from President Biden and Congressional Democrats. Twenty-six of the richest people in America paid an average federal income tax rate of just 4.8% over six years (2013-18) when the growth in their wealth is counted as income, according to Americans for Tax Fairness (ATF) using IRS tax-payment information recently released by ProPublica and billionaire wealth growth data from Forbes. IRS Data from ProPublica Reveals Some of America’s Richest Paid Next to Nothing On Their ‘True Income’ in 2013-18 ![]()
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