Terry Taylor is worth about $2 billion, and you have almost surely never heard of him. Based in Florida, he doesn’t put his name on the car dealerships that he buys up, and he reportedly attends conferences only on the condition that no one announces who he is. Taylor came to our attention in 2023, when he paid $76 million for an Aspen mansion—then the most expensive home sale in the Colorado town’s history.
In 2024, Forbes magazine, which keeps tabs on the richest people in the United States and around the world, slotted Taylor in at No. 1,694 on its World Billionaires List and published a profile titled “The Car Dealership Billionaire No One Knows.” “He’s like Batman,” a source told Forbes. “You hear about him and you admire his work, but nobody has really ever seen him in real life.”
When Americans picture the ultrarich, they typically think of tech billionaires such as Elon Musk and Mark Zuckerberg, whose wealth lies predominantly in shares of publicly traded companies. They might also think of Wall Street financiers and celebrities such as Taylor Swift. But far more typical are figures like Terry Taylor—which is to say, owners of successful privately held businesses. We are economists who have been studying taxation and inequality for more than a decade. By our calculations, about 1.7 million Americans have each built a net worth of at least $10 million by owning a private business. For every CEO of a public company, there are more than 1,000 private-business owners with a net worth of more than $25 million.
In the course of our research, we’ve come to call these people “everywhere millionaires” because they exist all around the country, in a huge range of industries. Perhaps not surprising, some of these millionaires have stakes in investment firms or medical, dental, or legal practices. But the ranks of everywhere millionaires also include a repo man from Henderson, Nevada; a car-wash owner from Milwaukee; a treated-lumber magnate from Alabama; a boat-cover maker from the Ozarks.
[Ray D. Madoff: How to tax billionaires]
What we found changed how we think about inequality. During the Occupy Wall Street protests after the 2008 financial crisis, the prototypical one-percenters were executives at big banks. Today, when Senators Elizabeth Warren and Bernie Sanders propose making the rich pay their fair share, they aim at Wall Street and Silicon Valley. But far more relevant to the story of inequality in America are the everywhere millionaires who quietly press their elected representatives for favorable treatment. The tax code bears their imprint far more than it does Musk’s.
Last year’s One Big Beautiful Bill Act, for example, gutted the electric-vehicle and clean-energy credits, to the Tesla CEO’s detriment. The same bill made permanent a 20 percent deduction that effectively lowers the top tax rate for private-business owners from 37 percent to 30 percent. And it preserved a loophole that lets business owners in most of the country, but not salaried employees, deduct their state and local taxes in full.
When asked on Meet the Press why the cut for the highest earners had to be permanent, House Speaker Mike Johnson said: “This is not giving tax cuts to millionaires; it’s the opposite. The people in the tax bracket that you’re referring to, many of them are small-business owners.” Although many top-bracket taxpayers do indeed own businesses, the benefits of these provisions flow overwhelmingly to the wealthiest among them.
A loophole that lets private-business owners avoid Medicare taxes has similarly been justified as a break for the little guy. Preserving the family farm has been a pretext for passing ever larger exemptions to the estate tax, to the point that a married couple can now pass on $30 million to heirs tax-free. Hiding behind small business, in short, has proved a devastatingly effective strategy for the rich.
The financial affairs of some of the wealthiest Americans have long been opaque. The Forbes 400 began in 1982 at the direction of the publisher Malcolm Forbes, who reportedly had been inspired by the ballroom capacity at the New York socialite Caroline Astor’s Fifth Avenue mansion. At the time, editorial staffers doubted they could find the 400 richest people, let alone measure their wealth. Although for public companies, people who own a large number of shares must disclose their holdings, and the compensation of top executives is a matter of public record, many wealthy owners of privately held businesses closely guard details about their finances. Kerry Dolan, a Forbes editor, told The New York Times in 2022 that the magazine’s search for billionaires might never pick up on someone who had quietly made $250 million from selling a stake in a business and had invested the proceeds well.
The U.S. government’s view into this world is similarly limited. The Federal Reserve’s Survey of Consumer Finances includes a supplemental sample of a few hundred ultrarich respondents. Tracking down even this small number of people requires an expert staff to conduct interviews and a budget of tens of millions of dollars, a survey official told us. Only one in 10 who are contacted cooperates with the survey. The IRS collects voluminous confidential information about businesses and their owners. But it’s stored in a labyrinth of separate systems and databases, making it hard for anyone to use it to answer even basic questions: How many private-business owners are there across the United States? How rich are they, and how did they become rich? Without detailed information on how privately held businesses operate and make money, experts cannot estimate the effects of tax changes and other policies.
After the two of us finished graduate school in 2014, we worked as unpaid analysts for the U.S. Treasury’s Office of Tax Analysis. Along with our friend Danny Yagan, we were assigned a project to help the department figure out how much tax various categories of business owners were paying, and we were given a database of anonymized records to analyze. (For research purposes, each taxpayer is assigned a unique identification number. The names and actual tax IDs of the businesses and individuals who submit tax forms are confidential; the IRS cannot legally disclose them even to other parts of the government.) By combining various data sets over the course of months, we could fill out a detailed map of American enterprise and observe how business owners build their fortunes.
Even without knowing owners’ names, we learned a lot: We were able to cross-reference the tax data with anonymized data sets from past research containing standardized-test scores, parental income, and early-career trajectories. This information became the statistical foundation for a series of research papers.
The more we came to recognize the importance of everywhere millionaires, the more we wanted to understand their decision making. So we sought to identify some through public sources and tell their stories. We looked, for instance, at trade publications that ranked top earners. We interviewed industry experts and combed through databases such as Dun & Bradstreet, which collects reams of information about businesses and their leaders. We also tapped our own networks.
The more people we told about our quest to find rich private-business owners, the more leads we gathered. A family member from St. Louis pointed us to the Tracy family, who owns Dot Foods—the nation’s largest food redistributor, which generates more than $10 billion in revenue a year and was started from the back of a station wagon by a dairy farmer and his wife, Dorothy, in rural Illinois. Some of the most memorable businesses we came across were the least glamorous. One was a regional distributor of garbage trucks, street sweepers, and sewer suckers for municipalities.
Once we identified the top earners in an industry, we learned more about them through public information, such as newspaper and magazine profiles and published memoirs. Property records for luxury homes and registries of private-jet and yacht owners pointed us to colorful stories. We traced a 100-foot yacht moored off Manhattan Beach to the founder of Bird Barrier, a company that keeps pigeons off buildings. A 383-foot yacht belonged to the man who built Harbor Freight Tools, the discount-tool chain. Others were owned by a forklift manufacturer in New Bremen, Ohio; a Long Island scrap-metal recycler; and a slew of auto dealers.
Whatever they sell—cars, treated lumber, boat covers—the everywhere millionaires have one thing in common: They own what have become known as pass-through businesses because their profits skip the traditional corporate tax entirely and flow straight to owners, to be taxed at the individual rate. This structure surged in popularity following the Tax Reform Act of 1986, which cut the top individual tax rate to less than the corporate tax rate for the first time in U.S. history. In the decades since, lawmakers have carved out multiple loopholes, so a dollar earned from owning a business is routinely taxed much less than a dollar earned in wages. Moreover, business owners have a far greater ability to underreport their income to the IRS than wealthy CEOs do.
In some sense, getting rich by starting a business is an old American story, but the rise of education-dependent knowledge industries has gotten much more attention in the past few decades. When we were graduating from college, we were drawn to what many American middle-class families have come to see as the conventional paths to prosperity: tech and finance. Eric worked for a time as a software developer in a few start-ups, and Owen as an analyst at a venture-capital firm. But our subsequent economic research showed that studying, going to good schools, and then landing a job working at a prestigious company was hardly the only way to get ahead.
[Annie Lowrey: The last Americans really paying taxes]
In the upper reaches of the wealth distribution, the advantages of entrepreneurship appear stark. According to our analysis of the 2022 Survey of Consumer Finances, the 65,000 American households worth more than $100 million consisted almost entirely of business owners; fewer than half held graduate degrees. When we matched entrepreneurs with their test scores, we found that people with average SAT results were more likely to build a highly successful business than to make a comparable fortune as a salaried worker. Owning, it turns out, often beats earning.
But for all the benefits of entrepreneurial risk-taking, everywhere millionaires are also the beneficiaries of U.S. government policy, which they shape to their advantage.
As Congress drafted the 2017 tax law—which ultimately became the biggest business-tax cut in history—we met an auto dealer who had become a member of Congress and warned that the bill would devastate his industry. Dealers borrow heavily to keep cars on the lot. To help offset the tax cuts, the proposed bill limited how much interest businesses could deduct. By the time the bill passed, though, auto dealers had won a special exemption from that limit.
Once you start watching for favors like this, you see these business owners’ influence everywhere: in tax legislation, in market regulation (or the lack thereof), and in the backgrounds of candidates for elected office. Everywhere millionaires don’t get the same attention as eccentric tech titans, finance executives, or famous entertainers. But seeing them is the first step to understanding the economy and society as they really are.
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