Quotessence
Home / Books / The Second Estate: How the Tax Code Made an American Aristocracy

The Second Estate: How the Tax Code Made an American Aristocracy

Book by Ray D. Madoff · 2 quotes · Dark Money, Donor Advised Funds, Income Inequality

Filter quotes by topic

AllDark MoneyDonor Advised FundsIncome InequalityTax AvoidanceWealth Inequality

The Second Estate: How the Tax Code Made an American Aristocracy Quotes

“A frequent refrain of those defending the status quo is that the income tax system already heavily burdens the rich because the top 1 percent of earners pay 40 percent of all income taxes while 40 percent of Americans pay no income taxes at all. This is partially true: Individuals with the most taxable income do pay the most income tax. However, this statistic is about people who have high incomes, typically from work; it tells us nothing about the tax liability of those with the most wealth. Studies have shown that there is only about a 50 percent overlap between America’s wealthiest people and those who earn the most income. Moreover, as the leaked tax returns of several of the wealthiest Americans reveal, the ability of wealth owners to avoid taxable income means that they are just as likely to be among the 40 percent of nonpayers as they are the top 1 percent of earners.”

Income InequalityWealth InequalityTax Avoidance
Book:The Second Estate: How the Tax Code Made an American Aristocracy
Create image

“Third, DAFs (donor-advised funds) allow private foundations to avoid the public scrutiny that Congress wanted them to have. If a private foundation makes a direct donation to a hate group or other questionable charity, that information is available to the public through public disclosure of tax returns. But if the private foundation wants to avoid this disclosure, it can simply make a distribution to a DAF, then make the donation to the hate group from the DAF, and no one is the wiser.45 While DAFs do publish their distributions, they list them over thousands of pages, and the information is disconnected from any particular donor. 45. Charitable gifts to hate groups can have devastating effects both within and outside the United States. Proposed legislation in Uganda imposing the death penalty for homosexuals was supported by significant charitable donations from United States taxpayers, many of which came from donor-advised funds. — Lydia Namubiro, “Charity Loophole Lets US Donors Give Far-Right Groups $272m in Secret,” Open Democracy (July 5, 2023).”

Dark MoneyDonor Advised Funds
Book:The Second Estate: How the Tax Code Made an American Aristocracy
Create image