From Jacobin:
As the Trump administration hollows out the country’s safety net for retirees and those with disabilities, the agency’s new chief has just been approved for a massive tax break for his Wall Street riches, according to new ethics documents reviewed by the Lever. …
To comply with federal ethics law, Bisignano has agreed to sell his shares in Fiserv, which are currently worth roughly $484 million. Because of a special loophole in the tax code for government officials, Bisignano will be able to indefinitely defer any capital gains tax on the divestment — meaning he may never have to pay taxes on the enormous windfall.
The exact value of Bisignano’s tax break is not clear from the ethics disclosure, but previous tax breaks for comparable divestments have been worth tens of millions of dollars. …
15 comments:
Would this explain why he wanted the job in the first place?
Not even a little surprised, we all know there are different rules for the rich, thats how they stay rich. Law only applies to the poor and powerless, always remember there is no justice, only power.
The plan is to privatize Social Security and help his Wall Street buddies at the taxpayers expense. Cabinet members are taking these jobs in order to expand their portfolios. It’s all all a grift whether it’s cryptocurrency or tax breaks.
I did a little googling to understand this "loophole" which I had never hear of before but seems to have been an issue in the past for very wealthy hires. https://www.nytimes.com/2006/06/02/business/a-tax-rule-could-save-treasury-nominee-millions.html
It seems that while it only called a "deferral" of the capital gains tax that would otherwise be due upon the sale of appreciated assets, the bill only comes due when the new assets purchased as allowed are themselves sold. But, if those new assets are never sold, then the tax is never due. Of course, at death the assets may be subject to tax but there are a myriad of ways uber-wealthy individuals can escape those taxes as well. Like in Catch 22, that Catch Section 1043 of IRS Code, that is quite a Catch.
Just maybe this explains the willingness of the plutocrats to join the Trump Gravy train and take what would seem to be trivial salaries for them just to get this mammoth tax break.
"Let Them Eat Cake" should be the new motto of SSA.
@11:27 Thanks for digging into this a little. I followed your lead and also confirmed that when (if) he eventually sells the new assets, the gain on that sale would treat the basis in the Fiserv stock as the basis for their replacements. In my mind, this is not really a windfall unless he desperately wanted to sell his Fiserv stock to buy something else but could not do so due to the tax on gains. This "loophole" amounts to a shuffle to a different asset to avoid conflicts. Nothing to see here, really.
No one wants to report on this kind of thing anymore. Frank gets a massive tax break…crickets. Does Frank even come to Baltimore?…crickets. Highest paid ALJs work from home full-time…crickets. Meanwhile RO employees laid off, told to eat dirt. And the beat goes on.
The sabotage continues
Nothing to see here.. really?
To comply with federal ethics law, Bisignano has agreed to sell his shares in Fiserv, which are currently worth roughly $484 million. Because of a special loophole in the tax code for government officials, Bisignano will be able to indefinitely defer any capital gains tax on the divestment — meaning he may NEVER have to pay taxes on the enormous windfall.
My understanding is that if an asset is kept until death, the heir takes the asset based on the value as of the date of death. So as long as Frank keeps the asset, no one pays the capital gains tax up until he dies.
ALERT*** Can someone comment on the manager meeting with Frank today???? The exact words that were used to described it were “Bizzarre, speechless, unprepared, and drunk”. Can anyone get the video? It was live streamed. The source said it was weird enough that they can’t imagine it not making it to the news” Anybody????
Money’s only goal is to replicate itself.
12:37 here. My point was that whether he sells the shares of new stock later with the basis established by the Fiserv stock, or he dies without selling the shares, is there really a change from his pre-appointment position as if he continued to hold the Fiserv share now?
Isn’t DOGE interested in eliminating waste, fraud and abuse?
The Trump administration on Wednesday asked the Supreme Court to block court orders requiring Elon Musk ’s Department of Government Efficiency to turn over documents about its operations to a government watchdog group.
The Justice Department’s latest emergency appeal to the high court concerns whether DOGE, which has been central to President Donald Trump’s push to remake the government, is a federal agency that is subject to the Freedom of Information Act. The administration argues DOGE is merely a presidential advisory body that is exempt from requests for documents under FOIA.
Currently, and apparently since 2017, Fiserv does not pay any dividends. So, unless he sells his stock, and pays capital gains on that sale, he can not receive any income based on simply holding his stock.
If he converts that stock, worth something north of $400 Million, into US Treasuries or an approved diversified mutual fund, which is what he would have to do to obtain the deferral, he could receive interest or dividends on that new investment. There are a range of possibilities but just considering US Bonds, the current rates are around 4% for two years up to just over 5% for 30 years.
So, he could trade his current stock of $400 Million that produces no current return other than the hope of increases in value of the stock going forward but also the risk of loss if the stock goes down but no hard cash now for interest on US Bonds of $16 Million at 4% on $400 Million with no substantial risk of loss in the underlying asset.
So, yes there is a big difference from where he is now if he just holds the stock. And, that says nothing about the issues if he holds the new assets until he dies.
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