Billionaires pay a federal income tax rate much higher than 8%, according to the latest data.
The smallest income group the IRS reports on is the top 0.001% of income earners. The taxpayers who filed those 1,575 returns in the 2020 tax year paid an average rate of 23.73%, according to a January 2023 analysis of IRS data by the nonpartisan Tax Foundation.
Speaking Aug. 15, 2023, in Milwaukee, President Joe Biden alluded to a report from his administration estimating the wealthiest 400 families paid an average of 8.2% of their income in federal income taxes.
But the estimate was theoretical. It included earnings on unsold stock as income. Stock gains are not taxed until stocks are sold, though at a lower rate than wages.
University of California, Berkeley, economists estimated that in 2018 the 400 richest families paid a rate of 23% in federal, state and local taxes.
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Tax Foundation Summary of the Latest Federal Income Tax Data, 2023 Update