Eli5 How does billionaires evade paying tax and not get arrested?.
In: 0
Not evasion, because that’s unnecessary risk when you can do it legally.
There’s the increasingly talked about “Buy, Borrow, Die” where billionaires borrow using stocks as collateral, which allows them to access a small portion of wealth while dampening taxable income. On death, their inheritors have stepped up value which voids the tax on what would be their gains.
There’re charitable foundations, like Patagonia did, where they spend a minor pittance of tax to create a foundation they board that uses the money in the same way they always wanted, but it’s tax free
There’s the Roth IRA, like Peter Thiel did, where they got their IRA to invest in their company early. As tax is paid before withdrawing, he was able to collect all the gains with the tax already “paid.”
Some industries like oil are so absurdly lobbyist-bought that you can just write off much of the spending and take the profits.
Latest Answers