How the super rich people pay next to no income tax?

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Income tax
Income tax

Ways billionaires save taxes

  1. Technically no income-

The super rich pay next to no income tax because technically they do not have any income. This is because most of the super rich people only take $1 salary and the rest they take in shares. And you don’t need to pay any income tax for owning shares.

2. Taking loans-

Then they take a loan form the bank against the value of the shares they have and spend them on their living. And again when you take a loan rather than paying a tax on the loan amount you get tax benefits.

Loan
Loan

3. Use dividend to pay loan-

When the rich people get dividends from their companies they use them to pay off the loan and the interest amount. And that all amount used to pay loan is also Tax Free.

4. Selling shares-

Even when they sell their shares they settle of with the loan amount and even if they have to pay the ‘Capital Gain Tax’ on their sold shares amount, its as low as 10–20%.

Conclusion-

So, you can actually never tax the rich. Therefore, the super rich people pay next to no income tax.

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Disclaimer:

The above information is for educational purpose only. Also, some of the information may be incorrect. So, please cross-check them.

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