ProPublica pointed out that billionaires, unlike most other people whose earnings come from conventional wage income, often benefit from “tax-avoidance strategies beyond the reach of ordinary people.”Some of the world’s richest men — Jeff Bezos, Elon Musk, Warren Buffett, Carl Icahn, Michael Bloomberg and George Soros — pay just a tiny fraction of their increasing wealth in taxes.
ProPublica, citing confidential IRS data it obtained on thousands of wealthy people, reported that the 25 richest Americans “saw their worth rise a collective $401 billion from 2014 to 2018.”
But those people paid a total of just $13.6 billion in federal income taxes for those five years, which “amounts to a true tax rate of only 3.4%,” the article noted.
And their wealth is often largely based on the rising value of stock and real estate that is not considered taxable unless those assets are sold, the report noted.
ProPublica did not disclose how it obtained the tax information cited in the article, but did say that the outlet “went to considerable lengths to confirm that the information sent to us is accurate.” CNBC has not independently verified the information in the report.
The article said that according to ProPublica’s calculations, Buffett’s “true tax rate” was just 0.1%, or $23.7 million in taxes he paid on wealth growth of $24.3 billion, during the five-year time frame.
During that period, Buffett, CEO of Berkshire Hathaway, reported legally taxable income of $125 million.
Bezos, who as founder of Amazon has become the world’s richest person, paid slightly less than 1% in ProPublica’s true tax rate, or $973 million, on wealth growth of $99 billion during the five-year period. Bezos’ actual taxable income during that time was $4.22 billion, the report said.
In 2007, Bezos “did not pay a penny in federal income taxes,” and he also avoided any federal income tax liability in 2011, the article said.
The world’s second-richest person, Tesla CEO Elon Musk, paid a 3.27% true tax rate, or $455 million, on wealth growth of $13.9 billion, ProPublica said.
Musk, who had an actual taxable income of $1.52 billion during the five-year period, paid no federal income taxes in 2018, according to ProPublica.
Bloomberg, former New York City mayor and founder of Bloomberg LP, paid a 1.3% true tax rate, or $292 million, during the time period looked at by ProPublica. His actual taxable income was $10 billion, the report said.
Soros, an investor, paid no federal income taxes between 2016 and 2018, which was a result of him losing money on his investments, his spokesman told ProPublica.
Icahn, another investor, paid no federal income tax in 2016 and 2017, years in which his total adjusted gross income was $544 million, the article said.
Icahn told ProPublica that he registered tax losses in both of those years as a result of taking deductions worth hundreds of millions of dollars due to the interest he paid on loans.
Asked whether it was appropriate that he had paid no income tax in certain years, Icahn said he was perplexed by the question, ProPublica reported.
“There’s a reason it’s called income tax,” Icahn was quoted as saying in the article. “The reason is if, if you’re a poor person, a rich person, if you are Apple — if you have no income, you don’t pay taxes.”
He added: “Do you think a rich person should pay taxes no matter what? I don’t think it’s germane. How can you ask me that question?”
White House spokeswoman Jen Psaki on Tuesday was asked about the leak of tax information to Pro Publica.
“Any unauthorized disclosure of confidential government information by a person with access is illegal, and we take this very seriously,” Psaki told reporters at a news conference.
“The IRS commissioner said today that they are taking all appropriate measures, including referring the matter to investigators and Treasury and the IRS are referring the matter to the office of the inspector general, the Treasury inspector general for tax administration, the FBI and the US attorney’s office for the District of Columbia, all of whom have independent authority to investigate
“So obviously, we take it very seriously,” she added.
Psaki also said that she would not comment on the specific data in the article, but also said, “Broadly speaking, we know that there is more to be done to ensure that corporations and individuals at the highest income are paying more of their fair share.”
https://www.cnbc.com/2021/06/08/bezo...-in-taxes.html
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06-08-2021, 06:37 PM #1
Bezos, Buffett, Bloomberg, Musk, Icahn, Soros pay tiny fraction of wealth in income
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06-08-2021, 07:22 PM #2
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06-08-2021, 08:51 PM #3
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06-09-2021, 07:38 AM #4
"In 2007, Bezos “did not pay a penny in federal income taxes,” and he also avoided any federal income tax liability in 2011, the article said."
Now the IRS is investigating them, good.
Tired of another rich CEO's dirty ways of not reporting income tax. You don't Jeff Bezos made income in 2007 or the bare min. in 2011?
Lmao at "it's not their fault" lmao no **** they get away with this because they are the richest CEOs.
That's what's actually bullsh!t.
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06-09-2021, 09:44 AM #5
Yes I do believe it. I’ve made millions in stock in a year with receiving a tax refund from my chitty sous chef job. I’m sure he was taking salary in stock or somthing. Now if he chooses to exercises and sel stock and get money, due to its INCREASE he will be paying MORE then if he was just getting taxed a regular income that year.
Stay a salty whiny *******. I hate all these poor fuks continually coming after the money from people who carry this fukking country and pay/contribute more in taxes in a year then the whiny *******s do their whole lives.
So what if he skips a year here or there due to how things are structured. I guarantee he’s already contributed more then all the whiners combined.
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06-09-2021, 10:04 AM #6
It doesn't matter what you've done because this thread is not about you.
I'm sure you do believe your own bullsh!t lmao, and this is exactly what this thread is about.
I don't know the tax rates in US, nor really care but paying minute amounts while being the richest CEO isn't something that I admire.
Compare these published tax rate to the average joe, yea bro, I guess I'm a little bit salty when I read that they paid 3.4% in taxes. That's something to be criticized.
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06-09-2021, 10:26 AM #7
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06-09-2021, 10:34 AM #8
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People don't pay income tax on things that they purchase with their income.
Duh. They pay property tax on real estate, and possibly on cars and boats, but we don't have a wealth tax, thank God.
Imagine having to pay a tax on everything you own, in addition to every dollar you earn and every dollar you spend.Florida Crew as of 3/21
What part of "Shall Not Be Infringed" are you having trouble with?
Misc Firearms Crew
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06-09-2021, 10:34 AM #9
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06-09-2021, 08:34 PM #10
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06-10-2021, 10:43 AM #11
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I was watching some videos about this last night, hadn't read into it at all previously, and it actually sounds like legit arguments but shouldn't be news to anyone who understands a bit about tax avoidance
The key is that these wealthy people are borrowing against their unrealized gains and operating entirely outside of the tax system. They don't need to realize their gains when they can legit borrow billions against them and pay zero tax on any of it, and that helps prop up the stock market as well
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06-10-2021, 10:51 AM #12
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Not sure what country you are in, but I'd bet it's similar. You need to know the difference between wealth and income.
In the US, we only tax income. You can be Jeff Bezos and have a bad year where you don't make an income and therefore not pay "income tax".
The article is stupid.You don't have to be great to start, but you have to start to be great.
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06-10-2021, 11:02 AM #13
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It's not stupid at all, the ultra wealthy are playing complex tax avoidance games. A big part of the argument here is that the ultra wealthy aren't paying tax because they don't need to realize the gains on their stocks, they can borrow billions against unrealized gains and pay zero tax on the borrowed money
Not only that, interest on loans for invested money is tax deductible
Not only that, not needing to realize their stock gains just further props up the market
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06-10-2021, 11:52 AM #14
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Ok, so I'll play your game as if it were true (it's not). So, if they are borrowing "billions" then they will have to pay it back with "income" eventually. Your scenario is also dumb.
We don't pay a wealth tax (and shouldn't). Do you want your unrealized gains on your retirement to be taxed every year?You don't have to be great to start, but you have to start to be great.
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06-10-2021, 11:59 AM #15
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What scenario are you referring to exactly? Wealthy people are doing this right now, it's not some imaginary scenario and this isn't news to anyone who has done some research into legal tax avoidance
Obviously unrealized gains themselves shouldn't be taxed, but borrowing huge amounts of money against unrealized gains and then living off those borrowed funds is as good as income isn't it?
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06-10-2021, 01:57 PM #16
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No, it's not as good as income. 1. you pay interest on that money, and 2. you have to pay it back.
In the end, it's costing you more than it is saving you since you have to have some income to repay the loan thereby still paying income tax + the interest on the loan. You would be better off taking the capital gains and paying that rate v. ordinary income, which is what most very wealth individuals do. Or, set up a corporation that you control. It's better to control the money than to own it.
I'm not sure who suggested this scenario or where you read it, but I'd be interested in reading your source.You don't have to be great to start, but you have to start to be great.
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06-10-2021, 02:12 PM #17
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The interest on the loan is tax deductible, and that deduction can then be used to offset taxes on realized capital gains when you actually do cash in the stocks. And because you can take a loan on unrealized gains, the stock price isn't impacted by cashing out your stocks for spending.
There's an accountant on this very forum who specializes in taxes and makes insane money ($500k+/year last I saw him post numbers) helping the wealthy legally avoid taxes in these ways, and he just recently took out a loan against his investments to buy a $1mill+ property. Not because he doesn't have the money, but because it's an extremely smart tax avoidance strategy and he knows the system.
I know something this stuff because I've been researching strategies like this for my own use
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06-10-2021, 02:39 PM #18
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There's a lot to unpack here. ARe we talking about as an individual or as a business/corp/LP/etc?
As an individual, if you secure a loan against your stocks (not just "unrealized gain" never heard of that), the interest would not be tax deductible. As a business, technically, I couldn't use those funds for personal expenses (business funds used for personal expenses happen all the time in purchasing things like cars, planes, houses, etc.)
I also have a little experience here (not as an accountant), but both take a salary from my business and receive a K1 from my ownership in the business. I spend a lot of time with our accountant.You don't have to be great to start, but you have to start to be great.
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06-10-2021, 02:54 PM #19
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06-10-2021, 02:56 PM #20
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Don't have a clue how these super wealthy people structure their stuff but I'm aware of the different setups, I also own a corporation for tax purposes
Money borrowed for investing is tax deductible. If I take out a mortgage right now to buy a rental property, I can write off the interest on the mortgage. If I take out a loan to buy stocks, that interest is also tax deductible. There's a specific strategy here in Canada where you can gradually convert the mortgage on your primary residence into one big tax write-off. These top tier accountants clearly have a way of structuring things so stock awards for company founders etc are deductible.
https://ca.rbcwealthmanagement.com/d...eductible.pdf/
Accountants who service the 0.001% are some of the very few people who are aware of this chit, they wouldn't be engaging in this stuff and the 0.001% wouldn't be paying them insane money to do it if there weren't huge benefits. Normies don't even know these strategies exist, same with some of the philanthropic write-off strategies employed by the 1%.
Complaining? I know about this stuff because I want to use it myself brah, but I know it isn't fair and I guarantee a lot of these ultra wealthy people have a similar opinion despite using the strategies
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