To summarize some of the source material for articles like this, by propublica: https://www.propublica.org/article/billionaires-tax-avoidance-techniques-irs-files

1. Not selling stock, no income to tax, they rather borrow against stock value, which isn’t taxable.
2. The 5 Billion IRA, pioneered by Peter Thiel, the Roth IRA is a type of account that shields income from taxes and is intended to help working people save for retirement. In 1999 Thiel stuffed low value paypal shares into his that reaped billions in untaxed gains.
3. High Tax Rate Trading into Low Tax Rate Income. When they do realize income, billionaires do it by recognizing gains on long term investments, such as stock sales, which are taxed at lower rates, (bush tax cuts lowered it even farther than it was, info not part of article I’m citing though,) Jeff Yass, head of Susquehanna International Group, a Wall Street Parasite, pioneered creative ways to transform short term trading gains into long term ones. Saving over 1 billion in taxes in 6 years as such. (To have that much in short term gains, it’s likely they are utilizing Flash Orders. Tapped into exchanges, computer programs on lightning fast switches ascertain the movement of stocks by the trades being submitted, and slips in their trades on those stocks leveraged with borrowings before those orders go through, making a sort of parasitic gain, it’s not even illegal.) Details https://www.propublica.org/article/jeff-yass-susquehanna-tiktok-tax-avoidance, and https://www.propublica.org/article/jeff-yass-susquehanna-tiktok-tax-avoidance
4. Sports ownership: Make money while legally reporting losses. (This encompasses more than sports ownership but losses in any investment have long been offset against taxable income in others, they can pull losses back 3 years to offset taxes already paid, or forward like 10 years to offset future income. This is why billionaires have paid virtually nothing since 2008, even as the government bailed them out and they have never been richer.) But the article details sports teams allowing for even profitable teams to allow erasing taxable income. Sometimes the same expenses can be deducted twice, like costs of players’ contracts. Allowed to depreciate players’ value, and so many deductions that the owners pay less in taxes than people working at the stadiums serving food and beverages or working ticket kiosks or security.
5. Special tax breaks for Oil Drilling. Billionaires can pay zero taxes in ten years taking advantage of all of these tax breaks, many furthered by the Bush administration, at Dick Cheney’s influence. Although that is not mentioned in the article.
6. Using Hobbies as sources of offsetting taxable wealth. Race horses, 6 owners harnessed 600 million in write offs on horse racing operations at the 2021 Kentucky Derby for instance. Luxury Hotels for another, Beanie Baby founder Ty Warner went 12 years without paying taxes after splurging on a couple of four seasons hotels.
7. Change the Laws. Investing in politicians pays for itself. Not the least with this administration, but let’s be honest, none of them have changed anything back. Business owners also slashed their salaries and categorized the money as passthrough income to avoid taxes.
8. Tech Billionaires pay less than hedge fund managers now, of the top 400 earners, those with over 110 million/year in income, overall they paid low rates, but Tech, heirs, private equity executives, stood out for drawing on the type of techniques mentioned above. Also wealthy politicians like the governors of colorado and west virginia used them. https://www.propublica.org/article/how-these-ultrawealthy-politicians-avoided-paying-taxes
9. The real champions of tax avoidance paid so little they collected stimulus checks, at least 18 of them in 2020, because their returns placed them below the cutoff of 150k for a married couple. https://www.propublica.org/article/these-billionaires-received-taxpayer-funded-stimulus-checks-during-the-pandemic
10. Holes in the estate tax that you can drive an armored convoy through filled with gold. They’ve been poking holes in the estate tax for decades, once again the bush administration made a lot of changes that enabled basically all of the billionaires to avoid this tax. All under dishonest arguments, railing against the injustice of the tax affecting family farms and the like, which it did not do. It only affected the largest estates, and now it doesn’t touch them.

Half of the 100 richest families used real estate dodging trusts in just one method of dodging this tax. One three century long fortune passed down to a great great granddaughter collecting 210 million before her 19th birthday with no taxes levied for instance.

In analysis of this information from the linked propublica article and the public record, none of this would be possible if the IRS actually enforced the law against the rich. Neither party has changed the IRS back to what it was before the Bush Administration, let alone to what it was before Reagan.

Bush reassigned something like tens of thousands of auditors, two different times, from the wealthy to the poor. Their new thing is chiseling people out of the Earned Income Tax Credit. The cost of these enforcements exceeds the amounts collected, and they habitually with the EIC prevent/take away the credit when the person qualifies to receive it. Denying benefits to people that qualify for them, spending more money on doing it than they save.

While the rich do the above, and everyone down the line from them also chisels the feds out of all the money our corrupt lawmakers have given them ways to do over the decades. The entire tax burden has been shifted onto the shoulders of working people that we’ve been led to have nothing but contempt for. If we are working we have contempt for those below us, even as the ones handing you that opinion have contempt for you being below them.

The democrats didn’t change anything back, not to any significant degree, and even Biden getting a lot of money to actually refund the IRS didn’t go into effect for years, guarenteeing it would be cancelled by the Republicans unless the democrats won, something they do over and over, with broadband internet to rural areas for instance. In the WPA they started projects in 6 months, or democrats set things up to take years and years before any work is started. It’s not something the republicans force on them, they choose to set it up this way.

Beyond putting a timeline on the IRS doing anything, they didn’t wholesale change all of those auditors back to the wealthy where they MADE money on enforcements not lost it, not to any large degree, as Obama didn’t before him despite token gestures to look like they did something. Then just to top it off, Biden cancelled a quarter of his IRS funding in exchange for increasing the debt limit, the Republicans threatened to scuttle the ship they were all on, Biden refused to negotiate, but the republicans knew better. They played chicken, threatening to blow them all up, and Biden caved. He was chosen to cave, they have never won a game of chicken. He cancelled a quarter of the funding. All moot anyway as republicans now control the federal government anyway and will turn that money against their opponents and critics now.

The tl;dr is:

1. That dementia riddled shithead Reagan changed the law to allow companies to buy back stock. This is classic stock manipulation and was illegal before that piece of shit was elected by the same degenerate demographics that are fucking up shit today.
2. Billionaires will “borrow” say, $100 million dollars, using their stock as collateral. Now they only have to pay the interest, low single digits, instead of actual income tax.

And a key quote from the article:

As a result, loopholes abound that allow the wealthy to shelter their money from taxation. These mechanisms are so effective that even though the wealthiest 1% of Americans own $50 trillion, the entire amount collected by the estate tax in 2024 was about $30 billion, an amount that Musk has gained and lost in a day.

I’ve been thinking about employee stock options lately. The original idea was that options would vest as a result of executives increasing the stock price through good business practices. Now though, so much of the market is occupied by index funds that major companies’ stock prices will rise just for treading water as everyone keeps pumping money into retirement accounts comprised largely of index funds. So instead of a reward, they just become a way to skirt income taxes as long as you hold the stock long enough. The article mentions buybacks as well, which can also inflate the stock price guaranteeing options vest.

Propublica went into some detail about this in a series of articles surrounding their acquisition of the tax returns of some rich dickheads in the US here, including Bezos who paid 600 bucks in federal taxes in 2020 when his worth skyrocketed, and he claimed the child tax credit, just to twist the knife into the poor.

You pay more taxes than bezos does. If one year they did seemingly pay a lot of taxes, you can’t even be sure they didn’t later offset losses back three years to claw that money back, or they can pull losses forward a larger number of years to offset gains.

Think how this treatment would work for working people in the first place. You are a corporation, you hold a job, collect a wage. All the gross income from that is offset by your expenses. Your housing, transport, insurance, healthcare, food, etc. You would pay on what is left over, then you could still find ways to spend that money that would be going to taxes after expenses on charitable donations to offset paying even that, and could find a way to benefit yourself through that giving, especially if you made your own charitable organization, and paid your family members or pals an obscene salary for running that charity. After all you have to retain that talent for your non profit, and it takes a lot of talent to convince people you are worth a half of a million a year for attending a few board meetings and otherwise signing off on operations of a nonprofit.

Here is one of the articles there are a number of related ones: https://www.propublica.org/article/billionaires-tax-avoidance-techniques-irs-files

thier wealth comes from thier investments, and shares.

“Normal” Americans can do this too if they have enough capital. The amount needed may be less than you think.

These outcomes are features of modern finance and there aren’t a lot of secrets about how it works. A lot of people could benefit by learning and using the same rules for their own benefit. These so called rich people know it because they talk about it with each other. Normies can look to forums like coastfire, expatfire, leanfire and similar for tips about how to similarly exploit the finance regulation in place today.

If you get a W2, and you spend most or all of the salary for living expenses - with no gap for significant savings, you’re trading a month of labor for a month of living expenses. It might feel ok because you sit on a leather seat or stay in the Hilton sometimes. But if there is nothing left over you’re perpetually running on fumes.

The only way out of this is by cutting expenses and creating as wide a gap as possible and pouring it into assets that grow, not shrink, in value. With the power of compounding returns nobody is more than a decade, decade and a half or so away from freedom. But yeah, you do have to live like a miser during that time.