Billionaire Hypocrisy: George Soros May Owe $7 Billion In Taxes

Tyler Durden's picture

“You support President Obama’s proposal to increase taxes on the wealthy?” That was the question put to George Soros on CNN some three years ago. Here was his answer:

“Yes, very much… the super bubble really resulted in creating a great increase in inequality, and now we have the after effect where you have slow growth, but if you could have better distribution of income, then the average American would actually be better off.”

There’s no question that “everyday Americans” (as a reminder, those are the people Hillary Clinton wants to help by running for president… well, those people and perhaps a few foreign governments and any investment bank who is willing to pay her husband six figures for a speech) would be better off if they got a larger piece of the pie, but as we’ve seen over the past several months, that’s not likely to happen as wage growth declines for the 80% of American workers classified by the BLS as “non-supervisory” even as the country’s supervisors see their pay increase, and as Fed policy continues to inflate the assets most likely to be concentrated in the hands of the wealthy. As this sad reality continues to play itself out destroying the American Middle Class in the process, we wondered if Soros was doing his best to ameliorate the situation by redistributing more of his vast wealth to the very same “average Americans” about which he expressed so much concern in 2012. The short answer: no. 

Via Bloomberg:

George Soros likes to say the rich should pay more taxes. A substantial part of his wealth, though, comes from delaying them. While building a record as one of the world’s greatest investors, the 84-year-old billionaire used a loophole that allowed him to defer taxes on fees paid by clients and reinvest them in his fund, where they continued to grow tax-free. At the end of 2013, Soros—through Soros Fund Management—had amassed $13.3 billion through the use of deferrals, according to Irish regulatory filings by Soros…

 

Congress closed the loophole in 2008 and ordered hedge fund managers who used it to pay the accumulated taxes by 2017. A New York-based money manager such as Soros would be subject to a federal rate of 39.6 percent, combined state and city levies totaling 12 percent, and an additional 3.8 percent tax on investment income to pay for Obamacare, according to Andrew Needham, a tax partner at Cravath, Swaine & Moore. Applying those rates to Soros’s deferred income would create a tax bill of $6.7 billion…

 

When Soros founded his firm, nothing in U.S. law prevented money managers from postponing the acceptance of client fees and letting the money remain in their funds, where it could grow untaxed. But doing so wasn’t really an option for funds based in the U.S., because if managers didn’t take the fees, their clients wouldn’t be able to deduct them from their own taxable income.

 

Hedge fund managers could circumvent this obstacle by setting up parallel offshore funds for investors who weren’t subject to U.S. taxes and who therefore didn’t care whether their fund manager deferred taxes on the fees. That way, the fees—typically 2 percent of the amount invested and 20 percent of any profits—plus any investment gains, could grow without being taxed until the managers withdrew the money…

 

A manager with Soros’s track record who started with $12 million from investors, took 20 percent of the profits, and reinvested that money tax-free over 40 years, would end up with $15.9 billion. If that same manager paid federal, state, and local taxes on the fees and related investment gains before reinvesting them, the figure would shrink to $2.4 billion…

Here’s the simple math: 

In the end, it would appear that we simply have yet another case of billionaire hypocrisy: "please raise taxes on all the uber-wealthy... except me."

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
HonkyShogun's picture

Oh he uses TurboTax too?

ZH Snob's picture

some are more equal than others

Looney's picture

Obama about Soros: He could’ve been my son. ;-)

Looney

BoredRoom's picture

he's a democrat, so this is not a problem

Oh regional Indian's picture

Think, he knows he will not have to pay anything in 2017 because the system will be kaput, broke-n!

This bird will be dead, most assuredly.

This shows, by lateral association, the knowledge of an insider.

Or so I think at any rate. It does seem to match a timetable though, given how things are re-gressing, in waves.

+ Martin Armstrong also said hard down in 2017.6347, did he knot?

Yep...

Muse...ic...

https://www.youtube.com/watch?v=KhJjChT1nq4

Four chan's picture

frankly i wish i were rich enough to have a 7 billion dollar tab going with the irs.

ali-ali-al-qomfri's picture

No thanks Frank,

I'll keep my moral compass true and my karma clear.

Soros is of humanity.

SumTing Wong's picture

As for Soros...let him eat lead.

Shad_ow's picture

quid pro quo so forget it. Nothing will happen, he won't pay

what he owes or a penalty.

JRobby's picture

Bring back debtor's prisons for those with net worth above $1b

quasimodo's picture

Cut off his head? The lizard will just mutate and grow another

HonkyShogun's picture

True enough. Until the guillotines come out.

drendebe10's picture

Azzhoe progressive liberal democraps always want everybody else's money to spend but not their own...

 

Q: How many democraps does it take to change a light bulb?

A: That's not funny and ur a raycist and gimme all ur money cuz i know how to spend it better than you.

dontgoforit's picture

The denizens of the crap-story are living proof that this movie is cast with all the wrong characters in the lead roles.  What a shamble of bullshit.

VinceFostersGhost's picture

 

 

Here is a partial transcript from an interview done by Steve Kroft for CBS’ 60 Minutes George Soros on December 20, 1998:

 

 

KROFT: Went out, in fact, and helped in the confiscation of property from the Jews.

Mr. SOROS: Yes. That’s right. Yes.

KROFT: I mean, that’s–that sounds like an experience that would send lots of people to the psychiatric couch for many, many years. Was it difficult?

Mr. SOROS: Not–not at all. Not at all. Maybe as a child you don’t–you don’t see the connection. But it was–it created no–no problem at all.

KROFT: No feeling of guilt?

Mr. SOROS: No.

 

dontgoforit's picture

First major hallmark of the sociopathic psyche: completely guiltless.

Baa baa's picture

Sociopath who never shook off the Nazi SS training.

j0nx's picture

Do as I say bitches, not as I do.

 

signed,

George

HowdyDoody's picture

<-- connect the dots?

<-- some kind of plague?

tnquake's picture

Nope, he uses A&L Sharpton for tax advice

madbraz's picture

hedge fund managers are worse than the plague.

Dr. Engali's picture

All these fuckers need to be hung.  When they say increase taxes on the wealthy they really mean increase taxes on the middle class, leave us elites alone.

fudge's picture

Please, can we start with George.

Dr. Engali's picture

It's a big club (getting smaller) and we ain't in it.

HughBriss's picture

Ooooohhh, Oligarchy!  ;)

BLOTTO's picture

Dont worry Dr.E - this mofo will meet his Maker.

.

And judging by his appearance, it will be sooner than later.

 

HopefulCynical's picture

All these fuckers need to be hung.  When they say increase taxes on the wealthy they really mean increase taxes on the middle class, leave us elites alone.

EXACTLY. THIS.

pachanguero's picture

Die you NWO scum, I hope you get cancer today!

Chupacabra-322's picture

Those Pure Evil Criminal Psychopaths get the Cure.

WillyGroper's picture

That's not true.

They finished of Teddy Kennedy nicely.

Then there's Arlen Specter.

I'm sure there's others.

Caroline is probably next.

wisefool's picture

Despite the cluster that obamacare is, Ted Kennedy was trying to stop the U.S. tax code from being intrinsically based on war provisioning. Healthcare (life, liberty, the pursuit of happiness) is a better foundation, even if subject to socialistic tendancies. Arlen "majic bullet" Specter saw this in the senate, and might have had a deathbed confession for his brothers in arms, so maybe they had to show him what was going to happen to his own family members.

Caroline does not deserve it either , but as the ambassador to Japan ...

WillyGroper's picture

So are you saying your tax dollars funding Specter's wife in spreading multiculteralism is nothing more than blackmail or threat of death?

"might have had a deathbed confession"?

FFS

That holds as much water as McNamara's DBC.

kowalli's picture

don't worry he will get medal and more bonuses for this.

q99x2's picture

That guy is weird and the older he gets the more teenage transfusions he requires. Somebody do him a favor.

youngman's picture

all these guys have armies of Tax Lawyers that keep them from paying taxes....and then they say they want to raise them on others.....If you think you should pay more..just send it in...but these guys love the money...they love the billions they have and they want more....its a status thing to them...

Soul Glow's picture

Taxes should be valuntary.  For example, if someone thinks climate change is real then they should pay a climate change tax.  Go ahead climate changers, put your fucking money where your mouth is.

Multi's picture

Impossible for taxes to be voluntary. Taxes are theft no matter how you disguise them, period. The "social contract" and all that crap is for the gullible.

 

“Everything the State says is a lie, and everything it has it has stolen.”

Friedrich Nietzsche

Jonesy's picture

Taxes are for the Goyim.  Yay!  Jews win again!

Soul Glow's picture

The WASPs want you to write like that. 

Thisson's picture

Fuck off, Jonesy, you ignorant cunt.