3. Millionaires pay proportionately less income tax than poorer people.In a speech on Monday, Obama said raising taxes on millionaires isn’t class warfare, but “math.” His math may be off: According to the IRS, those with adjusted gross incomes of more than $1 million paid an average of 23.3 percent in federal income taxes in 2008; those earning between $100,000 and $200,000 paid 12.7 percent; and those earning between $50,000 and $100,000 paid 8.9 percent. Nearly half of American families don’t make enough money to pay federal income taxes at all.
Why do people think millionaires pay less? One cause of confusion is that stock dividends and capital gains are taxed at a maximum of 15 percent, while regular income in their bracket is taxed at a maximum of 35 percent. The rich often earn more dividend and capital gains income than regular income, so it’s tempting to wrongly conclude, as Warren Buffet has, that millionaires “wouldn’t mind being told to pay more in taxes.” But dividends are paid out of corporate profits that have already been taxed. So Buffet’s equity earnings are doubly taxed: He pays 35 percent at the corporate level and 15 percent on his own return.
4. Millionaires share the same political beliefs.
That might have been true in pre-revolutionary France, where the nobility was exempt from most taxation (and why so many were subject to a brief meeting with Dr. Guillotin’s lethal invention). But it is certainly not true in 21st-century America, where political opinions among the rich are just as diverse as they are among the less well-off.
Just consider George Soros and the Koch brothers. They are listed high on the Forbes 400 list, but Soros funds Democratic campaigns, while the Koches helped foment the tea party revolution. Income can’t be used to predict political opinion. In 2008, for example, Obama won the votes of 60 percent of those with a family income under $50,000 and 52 percent of those earning more than than $200,000. McCain carried the middle class.
Read all 5 “myths”.
A long time ago I read that the average millionaire is a millionaire because they saved their money and live modestly. I wish when I was young I knew what I know now and I would be one of THOSE millionaires. I have talked to many people who have retired at 50 or younger Teach your kids to save for their retirement because there might not be anything for them when they reach retirement age.