Elon Musk, Jeff Bezos, and other American billionaires have apparently failed to fulfill their duties -- did they pay little to no income tax?
Some of America's wealthiest people have allegedly paid little to no income tax over the past few years, based on an investigative report on Tuesday, June 8.
As Washington D.C. weighs on new proposals that could address tax avoidance by wealthy companies and individuals, issues such as tax evasion and outsmarting the taxing system surfaced. Based on recent reports, Amazon's previous CEO, Jeff Bezos, Tesla's current CEO, Elon Musk, and other well-known individuals have a history of avoiding their duties as Americans.
ProPublica's Report: Musk, Bezos, and Others
Live Mint said in an article that New York-based journalism nonprofit called ProPublica is first to report that several wealthy Americans have been avoiding the taxing system for some time.
Based on ProPublica's report, Amazon Chairman Jeff Bezos did not pay any income tax from 2007 to 2011, while Tesla CEO Elon Musk waived all income tax payments in 2018.
ProPublica said that some of America's wealthiest pay little income tax -- sometimes, they don't even pay at all. However, the publication did not disclose how they got such information, especially now that tax data are considered confidential.
Elon Musk owns Tesla, an electric vehicle company responsible for the innovative self-driving cars known today. The company is responsible for the rise of Model S, Model Y, and other innovative models.
Musk is currently the second richest man alive, but CNET reported that ProPublica recently confirmed his avoidance of the law. He allegedly did not pay any federal income tax back in 2018, and only paid $68,000 in 2015, and $65,000 in 2017.
CNET also mentioned that Musk's wealth increased by $13.9 billion in the span of five years, starting from 2014 to 2018. Based on Musk's report, $1.52 billion came from his income, and he paid $455 million tax during the same period.
Musk uses a strategy that most wealthy individuals do -- using their companies' shares as collateral for their private loans.
Jeff Bezos is currently the richest man in the world, and ProPublica said that he paid zero federal income tax for 2007 and 2011.
In 2007, Bezos' wealth increased by $3.8 billion, according to Forbes, but he only reported $46 million in income, legally. He then moved on by offsetting his income as losses on investments as well as tax deductions. As a result, Bezos ended up with zero dollars of taxable income.
From 2006 to 2008, Bezos gained $127 billion, but he only reported $6.5 billion over 13 years. His cumulative tax bill totals $1.4 billion, which means that he only reported 21% of his reported income and 1.1% of his overall wealth.
Other Rich Americans
ProPublica also stated that other billionaires continuously pay little to no income tax to the International Revenue Service.
The list includes philanthropist and financial tycoon George Soros, New York City mayor Michael Bloomberg, and activist investor Carl Icahn. Although they did not do anything illegal for their tax declarations, ProPublica still believes that they utilized tax-avoidance strategies beyond the reach of the ordinary American person.
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Written by Fran Sanders