Bill Gates Calls for Higher Taxes on the Rich — But Here's His Own Tax History
Bill Gates is one of the most famous billionaires in the world. Originally known as the tech genius who co-founded Microsoft, Gates is now the head of one of the largest philanthropic organizations in the world: the $90 billion Gates Foundation. His own personal net worth is estimated to be $115 billion, enough to rank him the 17th-richest person in the world according to Forbes.
But unlike many billionaires, Gates calls out the American tax system as being decidedly unfair and in favor of the rich — and he wants to change it.
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Gates’ Tax History
Although Gates is clearly a charitable person, having donated more than $90 billion to worthy causes through his foundation, he’s clear that he shouldn’t be expected to pay more taxes than legally required.
That being said, a 2021 ProPublica analysis of 15 years of IRS data showed that from 2013 to 2018, Gates paid an effective tax rate of 18.4%. That’s actually higher than many lower-income Americans pay, and certainly far above the 0% rate achieved by some other billionaires.
Tax Breaks Gates Wants To Change — And How You Can Use Them to Your Advantage
While Bill Gates isn’t going to voluntarily hand over his fortune to the United States government, he is more than willing to pay more in taxes if he is legally required to — and he’s actually pushing for that very scenario. In the meantime, you can follow his lead to reduce your own taxes.
Estate Taxes
Gates said that the federal estate tax should be raised, so that there is no dynastic wealth in America. The federal tax is not an issue for most Americans because the IRS exempts $15 million of inheritance per person. But as Zachary Sahar, CPA and managing director at California-based Capital Tax, told MoneyLion, that’s not the end of the conversation.
“Some states impose their own estate or inheritance taxes at much lower thresholds," Sahar said. "Families should understand where they live, where they own property, how their assets are titled and whether trusts or lifetime gifting strategies make sense."
Capital Gains Taxes
Gates also believes that capital gains should not have a special tax rate. Currently, long-term capital gains can be taxed anywhere from 0% to 20%, but the highest ordinary income tax bracket sits at 37%.
Gates said that these types of tax breaks disproportionately benefit the wealthy. That’s true. All of his income in 2013 to 2015 came from the sale of Microsoft shares and were therefore taxed at the capital gains rate. But you don’t have to be rich to take advantage of the preferred tax rates.
A single filer with less than $49,450 of net income (about $65,000 gross) in 2026 pays 0% federal income tax on long-term capital gains, which the IRS defines as profits you earn on investments you’ve held for more than a year. What does that mean for the average person?
“Someone earning $55,000 has about $10,550 of room to realize long-term gains at a 0% rate,” said Joe Dimov, CPA, founder and CEO of Dimov Audit in New York.
If your regular tax bracket is 12% or less, you might even benefit from short-term capital gains tax rate, which is 15% for most people.
3 Most Important Steps You Can Take To Reduce Your Taxes
When you don't have billions, even small tax savings make a huge difference. When asked for his top three tips for reducing your taxes, Sahar suggested the following:
Maximize tax-advantaged accounts such as 401(k)s and individual retirement accounts.
Pay attention to how and when investment gains are realized (“realizing” a capital gain means receiving it).
Stop treating April as tax-planning season.
“By April, you're mostly documenting decisions you made the previous year,” Sahar said. “The taxpayers who consistently minimize their lifetime tax burden are making those decisions before the transaction instead of after it."
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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