Study Finds 5 Million ‘Everywhere Millionaires’ as Tax Code Fueled Pass-Through Wealth
Updated
Updated · The New Yorker · Sep 14
Study Finds 5 Million ‘Everywhere Millionaires’ as Tax Code Fueled Pass-Through Wealth
2 articles · Updated · The New Yorker · Sep 14
Summary
Nearly 5 million U.S. households hold at least $5 million in net worth, a new Zidar-Zwick study says, arguing these pass-through business owners—not billionaires—are America’s “real rich.”
The study ties that rise to tax policy: the 1986 reform made the top corporate rate 34% versus a 28% individual rate, boosting pass-through structures later reinforced by the 2017 20% deduction.
Those owners dominate ordinary industries from car dealerships to medical practices and convenience-store chains, while the typical pass-through decamillionaire is a 62-year-old white, college-educated man.
Between 1980 and 2024, labor’s share of national income fell to 56% from 65%; in top-owned firms, a recent $18,000 productivity gain translated into $15,000 for owners and $3,000 for workers.
The authors say that wealth now carries political muscle—decamillionaires hold 12% of congressional seats and lobby to preserve protections in sectors like beer distribution, real estate and medicine.
Why does the public obsess over tech billionaires while a hidden class of private owners legally bypasses massive tax bills?
How are America's invisible millionaires using new 2026 tax rules to quietly shield their massive fortunes from the public eye?
What secret legal structures allow local car dealers and lumber yard owners to build faster wealth than Wall Street elites?
Making Section 199A Permanent: The $700 Billion Tax Deduction’s Impact on Wealth, Deficits, and the Future of U.S. Tax Policy
Overview
The July 2025 passage of the One Big Beautiful Bill Act made the Section 199A Qualified Business Income deduction permanent, giving business owners long-term certainty to invest and hire. However, this move comes at a high cost: federal revenues are reduced by nearly $700 billion over a decade, limiting the government’s ability to fund public services. Most of the tax benefits flow to high-income earners, driving up post-tax income inequality. The large gap between individual and pass-through tax rates encourages tax gaming, while states that follow federal tax rules automatically absorb a narrower tax base. These changes together expand the federal deficit and complicate the economic landscape.