IRS: Over 2000 Big Earners Paid No Tax in 2000

More than 2,000 individuals with incomes of $200,000 or more paid zero in federal income taxes in the year 2000, according to a report released by the Internal Revenue Service on Thursday.

A separate IRS report showed the average income tax rate paid by the 400 tax filers with the highest incomes in 2000 was 22.29 percent, up from 22.23 percent in 1999 but below a recent peak of 29.35 percent in 1993.

Of $69.57 billion in adjusted gross income reported by the top 400 filers in 2000, about $44.53 billion was made through capital gains, Burman said

"Capital gains is the linchpin of every tax shelter I know of, except for municipal bonds," he said.

Capital gains are generally taxed at a lower rate than wages for all but low-income taxpayers. With the tax package passed in May, the rate will fall to 15 percent.

Bush and the GOP wanted to make capital gains 0%.