How the Super Rich Avoid Paying Taxes

Written by on January 9, 2013 in Money - No comments | Print this page



New found millionaires quickly learn how to lower their income tax rates. For someone with the means to do so, heaving millions of dollar through tax law loopholes is a rather effortless process. In fact, experts suggest that, as a whole, America’s wealthiest individuals should be paying between $70 and $100 billion more in annual income tax.

American taxpayers who make $1 million or less pay an average tax rate of 24 percent, but those making $10 million pay an average rate of 19 percent. This disparity only highlights how easy it is for the rich to reduce their taxable income.

One popular method involves making a charitable donation. An individual can purchase a sculpture for $1,000 one year, have it appraised for $10,000 some years later. He can then donate it to an organization, effectively earning a $10,000 reduction in taxable income.

Yacht owners, too, can claim their vacation vessels as a second home, as long as they spend two weeks of the year on board.



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