The Secret IRS Files: Trove of Never-Before-Seen Records Reveal How the Wealthiest Avoid Income Tax
ProPublica has obtained a vast cache of IRS information showing how billionaires like Jeff Bezos, Elon Musk and Warren Buffett pay little in income tax compared to their massive wealth — sometimes, even nothing.
- Avoid paying tax on capital gains with the "buy, borrow, die" technique:
- Buy or earn capital assets like stocks and real estate, and then never sell because assets do not count as income until sold.
- Using capital assets as collateral to borrow spending money at interest rates considerably lower than the tax rate; loans are not taxed as income.
- Holding capital assets until after death, when a "step-up in basis" zeroes out the accumulated gains and allows heirs to not pay any capital gains tax.