Report shows how billionaires including Jeff Bezos and Elon Musk pay little to no taxes

[midian182]

A hot potato: How much tax do you think Jeff Bezos paid in 2007, the year his fortune increased $3.8 billion, and in 2011 when he was worth $18 billion? The same amount Elon Musk paid in 2018: nothing at all. That’s according to a new report that reveals how the super-rich use legal methods to avoid or pay very little in federal taxes.

Using Internal Revenue Service data on the tax returns of some of America’s wealthiest citizens, ProPublica found that the 25 richest people in the US were worth $1.1 trillion as of 2018 and had a combined personal tax bill of $1.9 billion. It would have taken 14.3 million ordinary American wage earners put together to equal that amount of wealth, but the tax bill for those everyday workers would have been $143 billion—around 75 times more.

World’s richest man Bezos, whose current net worth stands at $177 billion, saw his wealth increase $3.8 billion in 2007 but was able to legally report $46 million in income, which he offset with losses from investments and tax deductions, allowing him to pay no tax. In 2011, when he was worth $18 billion, his income for the year was offset by investment losses. Because the law stated he earned so little, the billionaire claimed and received a $4,000 tax credit for his children, according to the report.

Even when Bezos did pay taxes, it was paltry in comparison to what he was earning. The CEO’s fortune increased by $127 billion between 2006 to 2018, yet his total reported income for that period was $6.5 billion. The $1.4 billion Bezos paid in taxes over those 13 years works out at 1.1% of his total wealth or 21% of his reported income. In contrast, ProPublica writes that a typical American household paid more in taxes than it accumulated in wealth over the last decade.

World’s third-richest man and alleged Anonymous target Elon Musk also avoided paying any federal income tax in 2018 while handing over just $68,000 in 2015 and $65,000 in 2017. Despite his wealth growing $13.9 billion between 2014 and 2018, he reported $1.52 billion in income and paid $455 million in taxes. Between 2014 and 2018, he had a true tax rate of 3.27%. The CEO has used Tesla shares as collateral on personal loans, a tactic employed by many billionaires to lower their tax bills.

Investor Warren Buffet, who has long called for the rich to pay more taxes, paid less than any of the top 25. His wealth rose $24.3 billion between 2014 and 2018, but he handed over just $23.7 million in federal tax—a true tax rate of 0.1%.

Most billionaires pay so little because the government only taxes what it defines as income, so when the value of the stock they hold increases, their wealth isn't taxed. They can then borrow against the stock to pay living expenses. This means they don’t have to sell their stocks, and the money from loans isn’t taxable as it has to be paid back.

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https://www.techspot.com/news/89992-report-shows-how-billionaires-including-jeff-bezos-elon.html

 

[QuantumPhysics]

The ultra rich have a million and one ways to avoid paying taxes. They get around it by claiming that "they are job creators".

States like Texas entice them to come to open up shop in their states by promising lower taxes.

However, I must say, we've all been duped to believe paying higher taxes is in someway patriotic.

The tax money is being mishandled, abused and wasted - growing the welfare state to support people who should not be supported. People of various socio-economic status who should not be supported.

Elon Musk is the face of corporate Welfare. The bulk of his money comes from US government subsidies and PRC subsidies. (More than 18% of Tesla income is from China)

The average person wants to pay the lowest tax they can pay so that they have more money left over to support and grow themselves. They move to states with lower pension taxes so they can survive. They move to states or even countries with lower capital gains taxes.

Bottom Line: As I get older and earn more money while watching America decline, I can see why it's declining and rampant government waste is the main reason.

 

[Plutoisaplanet]

This article has a serious flaw invalidating the whole thing, which is that it either assumes or intends for readers to believe the following: with billions of gains in wealth, they won’t have to pay more taxes on that wealth. Huge problem: almost all that wealth is considered unrealized gains—which means THEY WILL STILL BE TAXED. They haven’t yet because these CEO’s have sold very little of their stocks. Once they do, they will be taxed at the highest rate, currently 20+% though Biden intends to change it to 40% this year.

About stock/capital losses: these negate capital gains because someone else in the market (several tbh) made the gains this person lost. That means someone is paying those taxes still. And with capital losses, it is literally a decrease in wealth. So while it is tax effective, in the long run if you are rich then you only have so many capital losses (otherwise you wouldn’t have become rich) and will pay the full rates of tax later.

Capital gains does offer benefits in terms of taxes, but there’s a damn good reason for it: the US didn’t become the richest and most successful country in the world without a tax structure to support investing in and growing companies.

 

[QuantumPhysics]

This article has a serious flaw invalidating the whole thing, which is that it either assumes or intends for readers to believe the following: with billions of gains in wealth, they won’t have to pay more taxes on that wealth. Huge problem: almost all that wealth is considered unrealized gains—which means THEY WILL STILL BE TAXED. They haven’t yet because these CEO’s have sold very little of their stocks. Once they do, they will be taxed at the highest rate, currently 20+% though Biden intends to change it to 40% this year.

About stock/capital losses: these negate capital gains because someone else in the market (several tbh) made the gains this person lost. That means someone is paying those taxes still. And with capital losses, it is literally a decrease in wealth. So while it is tax effective, in the long run if you are rich then you only have so many capital losses (otherwise you wouldn’t have become rich) and will pay the full rates of tax later.

Capital gains does offer benefits in terms of taxes, but there’s a damn good reason for it: the US didn’t become the richest and most successful country in the world without a tax structure to support investing in and growing companies.

It always bothers me, that LIE about Warren Buffet paying less taxes than his secretary.

If only these newbs understood Capital Gains Tax vs. Income Tax.

There are a whole lot of millionaires who can't/refuse to cash out the market because they'd realize the gains and be subject to tax.

 

[Dimitriid]

This article has a serious flaw invalidating the whole thing, which is that it either assumes or intends for readers to believe the following: with billions of gains in wealth, they won’t have to pay more taxes on that wealth. Huge problem: almost all that wealth is considered unrealized gains—which means THEY WILL STILL BE TAXED. They haven’t yet because these CEO’s have sold very little of their stocks. Once they do, they will be taxed at the highest rate, currently 20+% though Biden intends to change it to 40% this year.

About stock/capital losses: these negate capital gains because someone else in the market (several tbh) made the gains this person lost. That means someone is paying those taxes still. And with capital losses, it is literally a decrease in wealth. So while it is tax effective, in the long run if you are rich then you only have so many capital losses (otherwise you wouldn’t have become rich) and will pay the full rates of tax later.

Capital gains does offer benefits in terms of taxes, but there’s a damn good reason for it: the US didn’t become the richest and most successful country in the world without a tax structure to support investing in and growing companies.

Well, problem solved! Next time a bridge collapses due to lack of maintenance we can rest easy since we know infrastructure will be fixed as soon as guys like Bezos decide to sell their stock, which is likely never going to happen.

 

[Plutoisaplanet]

Well, problem solved! Next time a bridge collapses due to lack of maintenance we can rest easy since we know infrastructure will be fixed as soon as guys like Bezos decide to sell their stock, which is likely never going to happen.

Elon Musk has always intended to eventually step down from CEO of Tesla and use his gains to fund SpaceX (probably this decade). When he does, this money will be taxed.

Bill Gates has paid over $10 billion in taxes so far (even after tens of billions in tax deductible donations) and is worth much less than these guys. Jeff Bezos is stepping down from CEO of Amazon this year. I’m sure he’ll divest from Amazon like Bill Gates did at some point.

 

[theruck]

Now imagine you get a loan of 1 million USD and you need to pay it back. How can you do it without income? You need to have a taxed income to pay for the loan. So where is the problem? The governments fcked up the day they started to tax the middle class and all inhabitants with nonsese taxes like vat or heritage or house transfers. Now the **** is deep as the ppl voting for the govs get taxed more and more by their elected govs whining all the time about rich ppl. Its easiest to tax the poor so there we go.

 

[BakaRed77]

I'm not sure why journalist try to write articles about this like it's a shock or even a bad thing. The rich invest a large amount of money into business which grows the economy. It makes sense to encourage them to do so by not over taxing them. Take any previous jobs you had. I'm sure you worked a job at some point where you made very little and had to budget according to your income. Once you got a better paying job you were able to spend more without concern for jeopardizing your financial security. Same applies to this on a much larger scale. They have more so they can spend more with less pressure about the decisions to do so. The middle class is the backbone of America and should front the most tax. However, as stated in previous comments, the government spending is out of control. Politicians spend spend spend and they don't even use our taxes wisely with that spending. There are countless programs being funded by tax dollars that many would consider frivolous and not in the interest of the majority of Americans. That being said I don't care if the rich are not paying taxes because they create economic growth which strengthens the country.

 

[Dimitriid]

Elon Musk has always intended to eventually step down from CEO of Tesla and use his gains to fund SpaceX (probably this decade). When he does, this money will be taxed.

Bill Gates has paid over $10 billion in taxes so far (even after tens of billions in tax deductible donations) and is worth much less than these guys. Jeff Bezos is stepping down from CEO of Amazon this year. I’m sure he’ll divest from Amazon like Bill Gates did at some point.

Like I implied: current needs cannot be addressed with future speculation that's usually not even guaranteed to happen. Not sure why you gain out of defending someone who's so incomprehensible rich numbers don't even matter anymore and why you think not even paying taxes right now it's positive but I guess you guys have to tell that to yourselves to justify things and then rationalize away all of the world crisis we're in that's directly because we allowed so much control to just one guy like Bezos because in return we act like beggar pet dogs waiting for him to drop some scraps from his table.

 

[wiyosaya]

Like I implied: current needs cannot be addressed with future speculation that's usually not even guaranteed to happen. Not sure why you gain out of defending someone who's so incomprehensible rich numbers don't even matter anymore and why you think not even paying taxes right now it's positive but I guess you guys have to tell that to yourselves to justify things and then rationalize away all of the world crisis we're in that's directly because we allowed so much control to just one guy like Bezos because in return we act like beggar pet dogs waiting for him to drop some scat from his rear.

FTFY!

 

[terzaerian]

I'm not sure why journalist try to write articles about this like it's a shock or even a bad thing. The rich invest a large amount of money into business which grows the economy. It makes sense to encourage them to do so by not over taxing them. Take any previous jobs you had. I'm sure you worked a job at some point where you made very little and had to budget according to your income. Once you got a better paying job you were able to spend more without concern for jeopardizing your financial security. Same applies to this on a much larger scale. They have more so they can spend more with less pressure about the decisions to do so. The middle class is the backbone of America and should front the most tax. However, as stated in previous comments, the government spending is out of control. Politicians spend spend spend and they don't even use our taxes wisely with that spending. There are countless programs being funded by tax dollars that many would consider frivolous and not in the interest of the majority of Americans. That being said I don't care if the rich are not paying taxes because they create economic growth which strengthens the country.

Probably because these are the same men that piously opine that the "rich" need to pay more taxes, while regularly paying nothing themselves.

 

[wiyosaya]

I'm not sure why journalist try to write articles about this like it's a shock or even a bad thing. The rich invest a large amount of money into business which grows the economy. It makes sense to encourage them to do so by not over taxing them. Take any previous jobs you had. I'm sure you worked a job at some point where you made very little and had to budget according to your income. Once you got a better paying job you were able to spend more without concern for jeopardizing your financial security. Same applies to this on a much larger scale. They have more so they can spend more with less pressure about the decisions to do so. The middle class is the backbone of America and should front the most tax. However, as stated in previous comments, the government spending is out of control. Politicians spend spend spend and they don't even use our taxes wisely with that spending. There are countless programs being funded by tax dollars that many would consider frivolous and not in the interest of the majority of Americans. That being said I don't care if the rich are not paying taxes because they create economic growth which strengthens the country.

Sounds like you support trickle-down economics. Good luck with that.

 

[messy]

Get rid of the IRS and implement The FairTax as written (not as the press and congress-critters mis-characterize it). solved

 

[JKnight]

Sounds like you support trickle-down economics. Good luck with that.

More like tinkle down economics.

 

[Homo Sapien]

“ProPublica found that the 25 richest people in the US were worth $1.1 trillion as of 2018 and had a combined personal tax bill of $1.9 billion.”

it’s just 0.17%

 

[hover389]

All of this info was known before. Nothing new came out of this report

 

[sreams]

Personal income taxes are on... income. Ownership of a thing (like a company) is not income. Want to measure how much people like this actually pay in taxes? Calculate what percentage of their companies they own. They paid that percentage of whatever those companies paid in taxes. Saying someone like Elon Musk paid $65K in taxes is disingenuous. The federal and state tax agencies should probably go take another look in their piggy banks if they think that is all the tax revenue he generated.

 

[sreams]

“ProPublica found that the 25 richest people in the US were worth $1.1 trillion as of 2018 and had a combined personal tax bill of $1.9 billion.”

it’s just 0.17%

*Income* tax percentages are not figured as a percentage of "rich"ness. They are figured as a percentage of personal income. When we talk about the middle class paying a 30% income tax, we are not figuring that against all of the savings they have and all of the things (like houses/cars/small businesses) they own. We are figuring it as a percentage of one year's worth of income.

 

[yRaz]

Sounds like you support trickle-down economics. Good luck with that.

I used to think like that, but then I realized my entire career, doing stone work, was built around a business model of taking rich peoples money. It doesn't work if you work at Mcdonalds(not saying fast food jobs are easy or get paid enough), but those businesses run on slim margins often selling the bulk of their products for low prices. If you want to make more money you have to know how to take money away from rich people or rich companies. They aren't just going to give you their money, but in a non-trickle down economy my job literally wouldn't exist.

 

[dustin_ds3000]

If you become a billionaire and move millions into a bank account and live from that money without selling stocks or earning a W-2 you wont ever pay taxes again lol. I cant believe that a report needed to be made to show this. Asset taxation happens when sold, if you don't sell you don't pay taxes. everyone calm your tits. they will pay the ultimate taxation when they die, don't worry.

 

[sdms96825]

All of this info was known before. Nothing new came out of this report

No, it was suspected, but not known. That's why so many government agencies are now searching for the leaker and threatening lawsuits for invasion of privacy.

 

[sdms96825]

If you become a billionaire and move millions into a bank account and live from that money without selling stocks or earning a W-2 you wont ever pay taxes again lol. I cant believe that a report needed to be made to show this. Asset taxation happens when sold, if you don't sell you don't pay taxes. everyone calm your tits. they will pay the ultimate taxation when they die, don't worry.

Uh, no they won't. Between their heirs getting the stepped-up basis and their generation skipping trusts, they won't pay very much. Many in the middle class cannot afford to buy stocks or mutual funds, hire lawyers to prepare the trusts, invest in 529 college savings plans, or even invest the max in Roth IRAs. And, worst of all, they cannot afford to hire lobbyists and make the political "donations" necessary to get congress to make loopholes favorable to the middle class.

 

[dustin_ds3000]

Uh, no they won't. Between their heirs getting the stepped-up basis and their generation skipping trusts, they won't pay very much. Many in the middle class cannot afford to buy stocks or mutual funds, hire lawyers to prepare the trusts, invest in 529 college savings plans, or even invest the max in Roth IRAs. And, worst of all, they cannot afford to hire lobbyists and make the political "donations" necessary to get congress to make loopholes favorable to the middle class.

I guess my priorities are different because I'm barely in the middle class with my normal 9 to 5 job but over the past 3 years I have bought stocks and hold and now with a value over 300k. you cant tell me people in the middle class cant spend a few hundred on stocks a month, give up Starbucks or something. It also helps that I don't and will never have kids.

 

[sdms96825]

I guess my priorities are different because I'm barely in the middle class with my normal 9 to 5 job but over the past 3 years I have bought stocks and hold and now with a value over 300k. you cant tell me people in the middle class cant spend a few hundred on stocks a month, give up Starbucks or something. It also helps that I don't and will never have kids.

Sorry, but spending a few hundred on stocks each month over 4 years does not come even close to giving you a value now of over $300K.

 

[dustin_ds3000]

Sorry, but spending a few hundred on stocks each month over 4 years does not come even close to giving you a value now of over $300K.

you do know that the value of a stock changes daliy right, if you buy 1 single stock for 1$ in 2018 and in 2021 it could be worth 10$. I only spent about 180k on all my stocks. I will lay out what I got. In 2018 my salary was around 65k a year and this year its 73k.

2012 shares of UBER with average of $32
1800 shares of SPCE with average of $17
1600 shares of CGC with average of $18
3110 shares of CCL with average of $21

if you want to you can do a little research to find out how much its worth then and now. ohh I did take a personal loan to buy CCL last year daring the crash last year, still owe 10k on that might be paid off before December.