During the pandemic, the collective net worth of America’s roughly 700 billionaires surged by $2 trillion, thanks to a rise in stock prices and the values of other assets, according to Americans for Tax Fairness.
At least eighteen billionaires and some more of the country’s richest have received taxpayer-funded stimulus payments last spring, according to a report by ProPublica.
Under the law, the full payments of $1,200 per single taxpayer and $2,400 for married couples were only available to single people earning less than $75,000 or couples with incomes below $150,000.
ProPublica found 270 taxpayers who collectively disclosed $5.7 billion in income, according to their previous tax return, but who were able to deploy deductions at such a massive scale that they qualified for stimulus checks. All listed negative net incomes on tax returns.
Wages rarely made up a significant portion of income for the 270 wealthy stimulus check recipients identified by ProPublica. In total, only $82 million, or 1.4%, of the $5.7 billion in income taken in by the group came in the form of wages.
The rich have so many tax advantages: Most people earn the overwhelming majority of their income via wages and take deductions where they can, however, the wealthiest taxpayers often have great flexibility in when and how they take taxable income, allowing them to pay a minuscule portion of their wealth growth in taxes.
The super-rich’s wages are to be avoided, carrying as they do the burden of not only income tax but also of payroll taxes. Additionally, some taxpayers had enough in deductions to wipe out even hundreds of millions in income.
“The tax code is simply not equipped to tax billionaires fairly, or even ensure they pay anything at all,” Senate Finance Committee chair Ron Wyden said.
In the past, many wealthy people also received stimulus payments the last time Congress offered them when millions of Americans were struggling. The 2009 American Recovery and Reinvestment Act offered a $400 tax credit for individuals and $800 for married couples.
This was called “Making Work Pay.”
Democrats are currently pushing for a law to “tax the rich”. This billionaires tax would place a new levy on asset gains, whether a billionaire has sold the asset or not.
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