I think anyone realizes this who has interest in the late night videos about getting out of their grind life and gaining wealth by buying real estate and flipping it and buying real estate with rental income possibilities to help pay mortgages.

Anyone who has ever formed a little corporation (i.e., LLC) and then filed taxes realizes this, the potential of moving a lot of normal expenses to the corporation, where it is not taxed as much, the potential of even employing like family members to do stuff. (Happens to be why, there are like rules with Obamacare for small business where you can no longer easily put your wife down as an employee as easily so that you can get her health insurance under the corporation.)

This point also got me thinking that this whole mindset it is actually part of the reason for popularity of the Trump persona before he ran for office. It is basically capitalism and I think a lot of people do understand that unearned income is taxed less, and they think that's okay because how else is anyone going to build a business and employ people and gain wealth without that incentive, that they aren't going to take on the responsibilities and headaches of owning a big business out of the goodness of their hearts. Same as they see that sweat equity in a home should eventually pay off big, that a house is not just a place to live.

I may be wrong but I think a lot more in this country believe this is right way to do things as opposed to a strongly socialist system where unearned income is heavily taxed. I think often immigrants especially believe this, that's why a lot of economic immigrants are attracted to this country from places that tax differently and why they often start businesses.

Edit to add: and who doesn't believe this is the people who believe in the 1950's myth of lots of high paying working class jobs under big corporations, and a world balanced between strong labor unions vs. big corporations where neither CEO's nor labor bosses make a ton of money. What happened after that short-lived world started to die: people saw how much money was made by owning a house and passing it on to your children, how that could help a family out of working class world.

Except "payroll tax" is a misnomer - it's a retirement insurance premium that you bank, guaranteed by good ol Uncle Sam decades after. So while the millionaire wont get gov payouts, workers will. There's more to it than that, but Social Security is a good deal.