[KevinEldon]

All the capital gains statistic tells us is that of the top 400 tax payers in 2009 capital gains represented 45.8% of their earnings. These 400 are the winners in the capital market. They're earnings aren't likely to reflect the risk associated with all capital investments. The overall markets shows us that there are a lot of losers and capital losses are common.

[webwright]

Yep- one interesting tidbit in the article is that, of the 3800 folks who hit the list since '92, only 27% showed up more than once. This seems to indicate than many of them won on one big bet... Quite possible not a capital bet either.

If you sell (all or some of) a company you started, that income is technically counted as capital gains as far as the IRS is concerned.

[jaxn]

Exactly. It also tells us most of those winners didn't win last year and won't will next year.

The 16% capital gain figure isn't saying that rich people consistently earn that much from capital gains every year, but rather the 400 highest earners had capital gains windfalls this year. Next year different people will have windfalls and different people will be on the list.