The IRS is now investigating how confidential tax return data was leaked that divulged how billionaires like Elon Musk and Jeff Bezos have paid zero federal income tax in some years.   

By PAUL WISEMAN and MARCY GORDON, AP Business Writers

A bombshell report from journalism nonprofit ProPublica showed that several billionaires completely avoided US taxes some years

The confidential IRS records from the wealthiest people in the United States were obtained by ProPublica and published on Tuesday. 

Amazon founder Jeff Bezos paid no income tax in 2007 and 2011, while Tesla founder Elon Musk’s income tax bill came to zero in 2018, according to IRS records obtained by ProPublica and published on Tuesday

IRS Commissioner Charles Rettig revealed during an already scheduled Senate Finance Committee hearing just hours later that authorities are investigating the leak of the tax data. 

‘We have turned it over to the appropriate investigators, both external and internal,’ Rettig said. 

The Treasury Department said multiple agencies were investigating, including the FBI, DC’s US Attorney’s Office and the Treasury’s Office of the Inspector General. 

ProPublica report shows just how little the rich pay in taxes

‘The unauthorized disclosure of confidential government information is illegal,’ a Treasury spokeswoman said. 

ProPublica has not revealed how it obtained the tax data. The outlet only said it was given the data in ‘raw form’ after publishing a series of articles that examined the IRS. 

The trove of records showed that Amazon founder Jeff Bezos paid no income tax in 2007 and 2011, while Tesla boss Elon Musk’s income tax bill came to zero in 2018.

Investor George Soros went three straight years – between 2016 and 2018 – without paying federal income tax, according to the records. 

ProPublica Reporter Explains How Ultra Wealthy Americans Avoid Taxes

Fellow investor Carl Icahn did not pay federal tax in 2016 and 2017.   

In reviewing the tax data, the site calculated what it called a ‘true tax rate’ for the billionaires by comparing how much tax they paid annually from 2014 to 2018 to how much Forbes estimated their wealth had grown in that same period. 

The report found that, overall, the richest 25 Americans pay less in tax than the average worker does. 

The median American household, in recent years, earned an average salary of about $70,000 and paid 14 percent in federal taxes per year.

Warren Buffett, the CEO and chairman of Berkshire Hathaway, has avoided the most tax, according to the records. Between 2014 and 2018, Buffet’s wealth grew by about $24.3 billion but he reported paying $23.7 million in taxes. It showed a so-called true tax rate of 0.1 percent

Based on data from the 25 richest Americans, they collectively paid a true tax rate of 3.4 percent between 2014 to 2018 on wealth growth of $401 billion.  

Warren Buffett, the CEO and chairman of Berkshire Hathaway, has avoided the most tax in recent years, according to the records.

Between 2014 and 2018, Buffet’s wealth grew by about $24.3 billion but he reported paying $23.7 million in taxes.

Investor Carl Icahn, who is ranked the 40th wealthiest American with an estimated fortune of $14.9 billion, didn’t pay federal income tax in 2016 and 2017. He is pictured with wife Gail Golden

It showed a so-called true tax rate of 0.1 percent, which equates to less than 10 cents for every $100 Buffet added to his wealth in that period.  

For Bezos, his wealth grew an estimated $99 billion and his total reported income was $4.22 billion between 2014 and 2018. 

George Soros, the founder of Soros Fund Management, has an estimated wealth of $8.6 billion. He paid no federal income tax between 2016 and 2018, according to the records. He is pictured with wife Tamiko Bolton

In that period, Bezos paid $973 million in tax, which equates to a 0.98 percent true tax rate. 

In 2007 when Bezos paid no income tax, the Amazon founder – in a joint tax return with then-wife MacKenzie Bezos – reported $46 million in income, which was mostly from interest and dividend payments from investments. 

He was able to offset his earnings with losses from other investments and deductions. 

In 2011, his tax return showed he had lost money and he claimed a tax credit worth $4,000 for his children.

The release of the confidential IRS records comes as President Joe Biden is proposing tax hikes on the wealthy to finance his spending plans.   

Biden wants to hike the top tax rate to 39.6 percent for people earning $400,000 a year or more in taxable income, which is less than 2 percent of US households. The current top tax rate workers pay on wages is 37 percent.  

He has also proposed nearly doubling the tax rate high-earners pay on earnings from stocks and investments.     

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