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Monday, Aug. 21, 2023

Do billionaires pay an 8% federal income tax rate?


no

Billionaires pay a federal income tax rate much higher than 8%, according to the latest data.

The smallest income group the IRS reports on is the top 0.001% of income earners. The taxpayers who filed those 1,575 returns in the 2020 tax year paid an average rate of 23.73%, according to a January 2023 analysis of IRS data by the nonpartisan Tax Foundation.

Speaking Aug. 15, 2023, in Milwaukee, President Joe Biden alluded to a report from his administration estimating the wealthiest 400 families paid an average of 8.2% of their income in federal income taxes.

But the estimate was theoretical. It included earnings on unsold stock as income. Stock gains are not taxed until stocks are sold, though at a lower rate than wages.

University of California, Berkeley, economists estimated that in 2018 the 400 richest families paid a rate of 23% in federal, state and local taxes.

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