Some Billionaires Paying Less Than One Percent In Taxes [WATCH]

Despite making more than a billion dollars, some of the nation's super rich manage to pay an extremely low tax rate.

The top 400 earners in the U.S. paid an average tax rate of 18 percent, according to a Bloomberg TV report noticed by Think Progress. And though that's a far lower rate than the 26.5 percent that many families making less than $100,000 pay annually in taxes, some of America's super-rich have been able to whittle their tax bill down even more, paying a tax rate as low as one percent, according to Bloomberg.

How? Many of the super rich take advantage of a variety of tax loopholes to lower their tax burden. For some of America's rich, most of their wealth comes from stock appreciation, according to Bloomberg, which some billionaires don't end up defining as taxable income.

These findings echo earlier reports, which suggest that the super rich may not be paying their full share in taxes. More than 1,400 millionaires paid no U.S. income taxes in 2009, according to an August report from the Internal Revenue Service.

In addition, 25 percent of all millionaires pay a smaller percentage of their income taxes than millions of middle class households.

But billionaires aren't the only ones that use loopholes to pay lower taxes. Thirty of America's most profitable corporations used rules like the "active financing exception" -- allowing corporations to sidestep paying taxes on overseas profits if they were derived by "actively financing" some activity or deal -- to pay less than zero in income taxes, according to a recent report from the Center for Tax Justice.

Though many super wealthy Americans and very rich corporations use loopholes to lower their tax burden, some have advocated for raising taxes on themselves. Warren Buffett became the most prominent advocate for raising taxes on the rich when he wrote an op-ed in The New York Times in August encouraging lawmakers to raise taxes on millionaires so that they pay the same or higher rate as middle class earners.

Earlier this week, a band of millionaires went to Capitol Hill to lobby Congress to raise their taxes. And they seem to have the support of millionaires around the country, nearly 70 percent of whom said in a survey last month that they support raising taxes on those making $1 million or more.

Watch the Bloomberg report here, courtesy of ThinkProgress:

What do the one percenters do? Check out the slideshow below:

Comments

[MrOnePercent2012]

01:53 PM on 01/07/2012

It always comes down to wanting to tax someone else....not us. The rich make an easy target but why should they support you?

[Mark Morrow]

04:16 PM on 01/06/2012

Maybe that's why Romney won't release his tax returns. You can bet he's paying less than 26%.

[irishlion7]

04:08 PM on 01/06/2012

You have the Far Right Republicans,Tea Party members and there vocal screamers complaining about how the poor pay no taxes while over 1400, multi millionaires pay less then 1% of ther total income in Federal taxes.For me I would rather pay 30% of my multi million income in taxes but I do not earn a multi-million income. I do not even earn 100,000. And after paying for my health insurance which just went up $200.00 a month I am just about making it. So where are the jobs that these multi-millionaires are supposed to be creating. And why do they, The Republican Party want to create more loop-holes for this income group crying that they pay to much already.
I can not even calculate what 1% of an unknown multi-million dollars would be. There were still millionaires and multi million aires befoe Reagan and Bush who paid 39% in taxes. And everybody had jobs. Then the REpublicans drop there tax rate to between 1 and 5% and no one is working will some one from the far right please explain that in simple languge to me!

[bobwitmer]

03:26 PM on 01/06/2012

But the Republicans tell us that these millionaires are, "job creators." For who, the people in China and other low-wage Third World countries? It's really unbelievable that these people can spew this two-faced diatribe with a straight face.

[Who Honest]

01:26 PM on 01/06/2012

Does that include these billionaires? Gerge Soros? Buffeit? Bill Gates?

How about Jon Corzine of MF Global fame?

http://www.iwatchnews.org/2011/12/08/7577/corzine-gave-5-million-help-candidates-win-office-now-hes-being-grilled-congress

How about George Kaiser of Solyndra fame?

http://www.iwatchnews.org/2011/10/13/6983/how-obama-fundraiser-turned-oklahoma-personal-tax-haven

http://www.iwatchnews.org/2011/10/18/7142/solyndra-investors-foundation-status-called-question

How abou these "rich" 1%'ers?

http://www.iwatchnews.org/2011/09/29/6774/bundlers-inside

http://www.iwatchnews.org/2011/09/29/6804/fact-check-obamas-tax-rate-not-lower-average-teachers

http://www.iwatchnews.org/2011/10/03/6865/fact-check-ad-billionaires-statement-misses-facts

http://www.iwatchnews.org/2011/07/05/5117/how-much-will-obamas-failure-stand-wall-st-hurt-his-re-election-chances

How much of Obama's failure is because of all the Wall Street/Hedge Fund (Soros? Corzine?)monies and all the Wall Street guys running Obama's government right up to Obama's own WH Chief of Staff (Bill Daley), Treasury Secretary Timmy the Taxcheat, and Timmy's Chief of Staff?

http://www.iwatchnews.org/2011/01/06/2218/obama-s-new-chief-staff-sought-loosen-post-enron-corporate-reforms

http://www.treasury.gov/about/Pages/Secretary.aspx

CEO NY Fed in 2008 and the mastermind behind TARP to bail out his Wall Street buddies!

http://www.usatoday.com/news/washington/2009-01-27-lobbyist_N.htm

[PeteG2]

12:17 PM on 01/06/2012

Warren Buffett, billionaire, pays a total tax rate (federal, state, local
& corporate) of 11% of his income and investment gains. A typical
minimum-wage earner pays total taxes amounting to 33% of her wages.

In the last 30 years the top 1% in the US have gone from owning 22% to 40% of
the nation's wealth .. largely due to the tax cuts for the wealthy
investor class started then. They were supposed to strengthen the economy.
Since then, average GDP growth dropped by one-quarter, due to tax-induced
investment bubbles & suppressed consumption .. repeated recessions.

For more, including a proposal for comprehensive tax-reform - that would
slash workers' taxes, fund education-research-infrastructure, make our
economy & democracy flourish, and slash the deficit - see
http://fairsharetaxes.org

[frank1946]

08:33 AM on 01/06/2012

Capital is never Idle, the Idle Rich is a Myth !

They are smart, mostly, except for Obama and Corzine.

Solyndra and Solar Scandals plus MF Global suggest that DEMS are very gullible ?

Rich now pay 38 % of all Taxes, how much is enough and what damage to job growth
happens from these Taxes, the Rich make Jobs you know ?

Real answer is to limit Federal Spending to 20 % of GDP.

[rini1946]

03:18 AM on 01/06/2012

I hate these half stories they are saying that a billionare has made million dollars on stock prices going up. How can you tax a person for that they did not sell the stock and anyone that owns stock know that I could be worth 100 dollars today and worth 40 dollars nest week. Look if the goverment would have taxed you on the gain on you house and what has happend in the past few years. They did mention that some of the rich only pay 18 % but the goverment has a alternative min tax so you have to pay 20% if your taxable money. And the only way to get that down is by chariable contributions. And most people forget that they have million dollar mansions they get on tax break on those so where you are paying 3grand in property tax they are paying 30 grand. I do not know of any breaks on state or city taxes they have to pay. What we should be worried about is how those idiots in the government keep spending it. And the more you give those idiots the more they will spend. I am not one of the rich ones I get SS and a small pension check. But the more you tax people the more the people will move out. Look at the states with the highest tax rate they have the highest unemployment because the companies moved out.

[harrystocratical]

06:41 PM on 01/05/2012

The issue with those perverted, self hating rich who want higher taxes for themselves,
is that they want to force higher taxes to the mentally healthy millionaires, who don't want higher taxes...

They do no stop at just requesting to harm...themselves,they want to harm ...other people too.
That's the psycopathy of those rich..

Of course they all use the so called "Bush tax cuts ",they are all "ruthless capitalists ",trying to maximise their profits ,"drinking the blood of their employees"...

Hypocricy at its maximum.

I wonder how stupid must be those who...praise those..."patriotic millionaires with a heart"...

[Coyote50]

02:24 AM on 12/06/2011

I think we should go back to what Eisenhower did. Under Eisenhower (Republican, World War II hero) anyone making over what would be $2.5 Million today was taxed at 90% on anything over that $2.5 M. And the tax rates were really progressive up to that amount, with 52% on what would be $197,000 today. Under Eisenhower we built the entire interstate highway system and paid off WWII.

The rates were SLOWLY coming down and then Reagan knocked the top rate down to 28% and the country went into a tailspin with a horrible recession. Reagan raised taxes 11 times after that to try to get us back on track, but never enough. That was the beginning of the current class war -- not seen since before the Great Depression. And it was the robber barons of the early 20th Century who caused that depression too.

History is important people -- we need to understand our taxing history and how it's affected employment and our quality of life.

For historical tax rates: http://www.taxfoundation.org/files/fed_individual_rate_history_nominal&adjusted-20110909.pdf

For converting dollars in the past to dollars today:
http://www.dollartimes.com/calculators/inflation.htm

[Kenz300]

10:01 PM on 12/04/2011

There once was a time when the wealthy gave to support their communities.

They once supported schools, libraries, hospitals and charities. They took pride in the business and the jobs that were created in the community.

Now the greed is good gang has taken over. The Republican party has turned into a selfish, self centered bunch of hate filled bullies.

It is time to vote the Republican party of the top 1% out of office.

[tnash26170]

10:09 AM on 01/06/2012

The lackey apologists for the wealthy are the truly amazing ones. Why are they not saying that the wealthy should pay the same dollar amount as a bus driver? But these same apologists were in power from 2001-2007 when the costs for war and pork were sky high. They crapped in the sand box and are trying to blame someone else.

[afinch9]

02:12 PM on 01/06/2012

tnash do you really want the rich to pay the same dollar amount as bus drivers? I'll bet they would come to your house and thank you if you can get that one through (okay maybe not wb but he still hasn't paid the $1 billion that berkshire hathaway owes.)

[afinch9]

02:09 PM on 01/06/2012

kenz you might want to research the gates foundation or the walton foundation or others that the rich set up

[kinggixxer1000]

11:03 AM on 11/22/2011

wow its hard to make it i do know that its funny how we have all the ansewers here but big govt do not know how to fix the tax problem mybe the wrong people r in office maybe!

[stalb427]

07:48 PM on 11/21/2011

To everyone slamming the author about the tax rates i really think you all need a fact check so here you go.

In the 2010 tax year the rate for a single filer who made 34k-82k was... (drum role) 25%....

Of course that is assuming no deductions, which i have none and i grossed 38k so dont tell me about what i didnt pay.

Reference:

http://www.bankrate.com/finance/taxes/2010-tax-bracket-rates.aspx

[afinch9]

02:23 PM on 01/06/2012

maybe you need to reevaluate your life style?

[stalb427]

07:36 PM on 11/21/2011

Im glad finally an article points at an issue i have with buffet and the millionaires that when to capitol hill.

Regardless of what % bracket they fall into, they will still pay less than what is deemed their fair share (%) thru loopholes. Same with corps. So to me all this attention about raising the tax rate on them is just a diversion ploy away from the real issue..

Cleaning up the american tax code so that no matter what your income is you pay your share at whatever that is at the time.

[afinch9]

02:24 PM on 01/06/2012

"the fair tax" read up.

[thomas James fuller]

05:31 PM on 11/21/2011

18% of 1 billion is $180Million bucks. Exactly what can the United States of America do for one person that justifies taking nearly $200,000,000 from them? Anyone that thinks they should pay more must not understand just how much money that is.

[lorraine sladich]

05:58 PM on 11/21/2011

They still have enough,$820,000,000, to live a super comfortable life. Whereas 26% on an income of $100K leaves a family with less than $74K, not to mention state and local taxeshave to come out of the $74K...Oh, yes and put money away for retirement.

[thomas James fuller]

08:32 PM on 11/21/2011

well, then they should work harder to make more. my god, if we play baseball for the mets.....no matter how badly we stink, we can't borrow runs from the yankees. We have to get better and do it ourselves.

[afinch9]

02:26 PM on 01/06/2012

in 2009 the average rate paid by someone earning $100,000 was 8.23%

[Bike Commuter]

08:12 PM on 11/21/2011

Almost nobody actually makes $1 billion a year. The top 400 tax returns barely averaged a third of that. That makes your example excessive. However, the point would still be the same, high earners pay large dollar amounts. To answer your question about what the United States of America does for that person to justify taking the large dollar amount, what they do is provide a system that allows that person to make such a large income in the first place. Also provided is the structure that assists the person in keeping their wealth (imagine trying to keep that wealth if there wasn't a system to prevent others from taking it in various ways).

[thomas James fuller]

08:34 PM on 11/21/2011

i was merely making a point. We can do the same at 100mm. it doesn't matter. Fact is this, giving 2 our of every 10 cents should be an absolute max. It is insane to believe that we should keep hammering the money out of them when they did all the work. The belief that they made money on the shoulders of our legal system, our infrastructure, etc. is just insane.