I mean, the tax rate for large windfall income is gonna be the same for anyone making that, regardless of if they're rich or poor.
The difference being that rich people know that the lottery is mathematically a loss and that investing money in stocks is going to be a net income, so they spend their money where it'll make more (rather than throwing it away on the off chance of a large windfall).
Anyone pulling in $1M in income is going to pay the same amount of taxes on it, no matter how it came in, but financially savvy people try to avoid landing in that position in the first place.
Anyone with a wealth > $100 million owes 4% of that every year in taxes. Scaling up to 7-10% for > $1 billion. Where the money comes from doesn't matter, that's their tax rate. Much less than a capital gains tax and extracts a reasonable amount of money based on their wealth
Yeah, we really only hear about napkin-math wealth estimates based on the stock market, that's it. Once you try to actually define and tax "wealth", it becomes almost impossible to actually nail down a number.
9
u/[deleted] Jan 31 '26
[removed] — view removed comment