Wealthiest Americans pay 16% federal income tax, same as middle class, but favoring wealth over work.

Recent analysis shows that the wealthiest Americans pay an average of 16% in federal income taxes, not significantly less than middle-class workers. However, the issue lies in how different types of income are taxed, favoring wealth over work. Billionaires use strategies like “buy-borrow-die” to minimize taxes on asset growth.

This strategy allows billionaires to borrow against their stocks tax-free, passing assets to heirs tax-efficiently. In contrast, regular workers face immediate taxes on their salaries. Despite legally paying tax obligations, billionaires’ wealth grows largely untaxed. If taxed like middle-class families, billions in additional revenue could fund healthcare, education, and infrastructure.

The tax system’s focus on taxing work over wealth creates fundamental unfairness. Middle-class families can’t defer taxes or borrow against stocks tax-free. Shifting the tax burden from work to wealth could reduce inequality and improve public trust in the system. The question isn’t just about increasing taxes on billionaires but reevaluating how wealth is taxed in an asset-driven economy.

Read more at Yahoo Finance: I Asked ChatGPT What Would Happen If Billionaires Paid Taxes at the Same Rate as the Middle Class