Taxes No Burden At All For Some
IRS says it's getting easier for the rich to pay no taxes at all
The New York Times today reports that the portion of the super-rich who pay not a single dime in taxes is rising.
The number of affluent individuals and married couples who paid no federal income taxes jumped more than 15 percent in 2002, to 5,650, new government data showed yesterday.
The chances of having a large income but not paying taxes on any of it are growing, according to the data, issued in the Internal Revenue Service's annual report to Congress on well-to-do Americans who live tax free. About one in every 436 high-income Americans paid no taxes in 2002, up from one in 531 in 2001 and one in 1,010 in 2000.
The article was written by Pulitzer Prize-winning Times scribe David Cay Johnston, author of "Perfectly Legal: The Covert Campaign to Rig Our Tax System to Benefit the Super Rich--And Cheat Everybody Else," possibly the first-ever relatively easy read on how the U.S. tax code increasingly shifts wealth from us wage-slaves to the super-rich. One of the more astonishing portions of the book explains the strange saga of the alternative minimum tax, a single line on your tax return that was supposed to function as a kind of a tripwire to block the mega-rich from paying nothing at all.
As today's Times article makes clear, the failsafe device hasn't stopped the super-rich from opting out of the tax system. Quite the contrary: The explanation's too long for Blotter; suffice to say that as tax rates have been cut for the richest Americans, the formula increasingly is used to pluck more money from the pockets of the middle- and upper-middle classes.
Johnston does a great job describing all of this in his book. If you'd like a preview, you can check out an interview with Johnston published in City Pages in January.
If you've read both the book and the interview and you still want more, check out Johnston's equally meaty June 5 Times analysis, "Richest are Leaving Even the Rich Far Behind." The piece is no longer available for free on the Times' website, and we here at Blotter don't want to run afoul of any pesky copyright laws, but we will point out that there are plenty of website operators who don't share our squeamishness; you can't find them easily by Googling the aforementioned headline.
Meanwhile, welcome to the era of the oligopoly. Now fork over your paycheck, assuming you're lucky enough to still get one.