And in direct contrast to the Trump Tax story….
Mon, 28 Sep 2020
Since the left is now in histrionics over President Trump’s perfectly legal use of the US tax code to avoid paying taxes for 10 out of the last 15 years, perhaps they’ll give as much attention to Joe Biden – who used another perfectly legal tax ‘loophole’ to avoid approximately $500,000 in payroll taxes on $15 million in income.
Of course, they ignored it in July when the Wall Street Journal reported that Joe and Jill Biden took advantage of the “S corporation” payroll tax loophole that the Obama-Biden administration unsuccessfully attempted to close.
According to the report, the Bidens routed income from book sales and speeches through S corporations – avoiding the 3.8% self-employment tax they would have paid if they had been compensated directly, and avoiding as much as $500,000 in taxes.
“There’s no reason for these to be in an S corp — none, other than to save on self-employment tax,” accountant Tony Nitti told the WSJ at the time.
And as the Journal‘s Chris Jacobs wrote last month, “According to the Urban Institute, a couple featuring one high earner and one average earner, retiring this year, will have paid a total of $209,000 in Medicare taxes during their working lives.”
“The Bidens avoided paying nearly twice that much in Medicare taxes during two years.”
Meanwhile, the Las Vegas Review-Journal suggests Biden is a hypocrite – as the former Vice President has been an outspoken opponent of such loopholes since Ronald Reagan was in office.
Per current tax law, S-corporation owners can legally avoid paying the 3.8 percent self-employment tax on their profits as long as they pay themselves “reasonable compensation” that is subject to regular payroll taxes. The IRS definition of “reasonable compensation” is a tad fuzzy, however, which led to the Bidens reporting less than $800,000 salary on their reported $13 million in combined profits. –Las Vegas Review-Journal
In 2019, The Intercept‘s Ryan Grimm shed light on the Bidens’ use of Delaware corporation laws to conceal financial information (via Breitbart):
“The Bidens have used their home state’s financial privacy laws to shield his income from public view, by setting up two tax- and transparency-avoidance vehicles known as S corporations,” wrote Grimm. “He and his wife Jill Biden called them CelticCapri Corp. and Giacoppa Corp., respectively, and, according to the Wall Street Journal, have reported more than $13 million in profits the previous two years that weren’t subject to specific disclosure or self-employment taxes. As CNBC has described, money Biden made from book deals and speeches flowed into the S corporations and was then remitted to Biden and his wife as ‘distributions’ rather than salary. When money is funneled through an S corporation, the recipient doesn’t owe Social Security or Medicare taxes on it, nor can the source of revenue be traced. (In addition to the distributions, the Bidens drew relatively small salaries from the S Corporations: under half a million dollars, for which they owed self-employment taxes.)”
Stones, glass houses, etc. We’re sure the MSM will apply the same lens to Biden’s perfectly legal tax schemes.