Elon Musk reportedly paid $0 federal income tax in 2018

• A ProPublica report has claimed that Tesla CEO Elon Musk did not pay federal income taxes in 2018.
• Musk, the world’s second-richest person, reportedly paid a true tax rate of only 3.27 percent from 2014 to 2018.
• It is still unclear how ProPublica obtained the confidential tax records, which are illegal for the IRS to distribute.

An analysis published by ProPublica has claimed that Tesla CEO Elon Musk did not pay federal income taxes in 2018 despite having $1.52 billion in taxable income between 2014 and 2018.

According to the report, Musk, the world’s second-richest person, paid only a 3.27 percent true tax rate, or $455 million, for his wealth growth of $13.9 billion over the five-year period.

Musk’s response to ProPublica’s request for comment was a simple “?”

ProPublica obtained and analyzed confidential IRS data on thousands of wealthy people, concluding that several prominent US billionaires escaped paying federal income taxes.

The report stated that the 25 richest Americans “saw their worth rise a collective $401 billion” but only collectively paid a total of $13.6 billion in federal income taxes from 2014 to 2018, which was a true tax rate of only 3.4 percent.

The analysis compared this to median US households with an annual income of $70,000 but paid a 14 percent tax rate to the federal government. Those with an annual income of over $628,300 paid 37 percent to the federal government.

According to the analysis, billionaire Warren Buffett paid the lowest true tax rate with just 0.10 percent. His wealth grew about 24.3 billion over the five years, earning about $125 million over that timeframe.

The world’s richest person, Amazon CEO Jeff Bezos, paid a true tax rate of 0.98 percent. Over the five years, his reported income was $4.22 billion but he only paid a total of $973 million in federal taxes.

Former New York City mayor and founder of Bloomberg LP Michael Bloomberg paid a true tax rate of 1.3 percent — his reported income was $10 billion but he only paid $292 million in federal taxes.

Still, billionares have “tax-avoidance strategies beyond the reach of ordinary people,” that allowed them to pay a lower true tax rate, ProPublica pointed out.

Nevertheless, the report illustrated the overwhelming gap between the top earners in the U.S. and the rest of the country.

The tax records are confidential and illegal for the IRS to distribute, so it is still unclear how ProPublica obtained them.

Source: Independent