Hey dad, could you tell me something that seems illegal but isn't? Absolutely. Each year I pay less in taxes than most teachers and nurses do, even though I make about a hundred times as much. Is this just some tax loophole for the rich? Absolutely. Because I work in private equity, each year I claim $10 million of my income as investment income. What's the catch? My compensation just needs to be taken out of the investments I manage for others. Then it is considered carried interest and is taxed at a much lower rate. So instead of paying 37% on your millions of profits, you pay 20%. But aren't you supposed to be helping others get rich? Yup. And as they get richer, so do I. Ah, the circle of wealth. Well, it's really more like a straight line, but I hear you.

Explore how tax loopholes in private equity allow high earners to pay significantly lower tax rates compared to average workers, revealing the implications for wealth distribution.