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On top of that, the people making the most money are often doing so via capital gains instead of income, so even without loopholes, they weren't starting at 90%.
https://www.factandmyth.com/wp-content/uploads/2013/03/taxesontherich.jpg
That is a much more complete chart!
Would love to overlay inflation / base money also. But I like yours better ðŸ¤
:-) Visualizing Economics is a good site for when you need to find some nifty charts.
but I've read that the 90% marginal tax rate was largely a fiction
A very big thing in 50s / 60s was "deferred compensation agreements". Basically reclassified salary into capital gains. Typically they would pay you a year later....so a small portion of your 1951 was paid to you then, then the bulk paid to you 12 months later...
Reclassifying salary as capital gains
Common in private equity and hedge funds
It’s similar to carried interest
Capital Gains Tax is capped at 20 percent today
Interesting. I don't think I had heard of that before.
The keyword is deferral
Capital gains tax kicks in if you hold an asset for at least one year plus one day or 12 months plus 1 day
Otherwise it’s taxed as ordinary income.
Shohei Ohtani is deferring 680 million for at least 10 years lol
I have heard this as well.
I don't recall the details, but I've read that the 90% marginal tax rate was largely a fiction. As in, it was there in the statutes, but basically no one would ever have had to pay it.
When you look at what people are actually paying in federal taxes (best measured by spending), I think it's been pretty steadily around 20% of GDP.