Skip to comments.Senators Blast Dem Mega-Donor Over IRS Investigation into Tax Avoidance Scheme
Posted on 07/23/2014 12:40:10 PM PDT by PoloSec
A major Democratic donor who is funding some of the lefts most politically active electioneering groups was subject to bipartisan condemnation this week in the midst of a federal investigation into his hedge funds tax avoidance schemes.
Senators from both parties blasted efforts by Renaissance Technologies, a hedge fund owned by Democratic mega-donor Jim Simons, to shield itself from federal income taxes during a Tuesday hearing.
Two banks and a handful of hedge funds developed a complex financial structure to engage in highly profitable trades while claiming an unjustified lower tax rate and avoiding limits on trading with borrowed money, said Sen. Carl Levin (D., Mich.) in his prepared remarks.
Levin chairs the U.S. Senate Permanent Subcommittee on Investigations, which is investigating the use of transactions known as barrier options to subject profits from complex financial instruments to capital gains tax rates, instead of much higher rates on standard financial trades.
Two hedge funds, including Renaissance, and a pair of major European banks are now the subjects of an investigation by the IRS over the scheme.
Renaissance Technologies was able to avoid paying more than $6 billion in taxes by disguising its day-to-day stock trades as long term investments, said Sen. John McCain (R., Ariz.), the committees ranking Republican, in his opening statement.
One thing is clear: Americans are tired of seeing Wall Street firms playing by a set of rules other than those that apply to ordinary citizens, McCain said.
Simons is anything but an ordinary citizen. A former National Security Agency code breaker, and later the chairman of Stony Brook Universitys mathematics department, Simons used his extensive knowledge of computer modeling to build one of the most successful hedge funds in the world.
His estimated net worth is more than $15 billion.
Simons has used that fortune of late to help elect Democratic politicians. His largest contributions during the 2014 election cycle have gone to two of the Democrats largest independent expenditure groups.
On a single day in March, Simons gave $2 million to Senate Majority PAC, $1 million to House Majority PAC, and $12,000 to the Democratic Senatorial Campaign Committee.
Simons has donated nearly $13 million to Democratic candidates, committees, and interest groups just since 2008, according to campaign finance data compiled by CQ Roll Call.
The top recipient of Simons cash over the past few cycles was Priorities USA Action, a Democratic super PAC that worked to reelect President Obama. Simons gave the group $5 million in 2012.
Yeah, well we are also tired of seeing DC establishment politicians playing by a set of rules other than those that apply to ordinary citizens. But you ain't gonna do diddly squat about either situation.
How could a guy smart enough to be an NSA code-breaker be dumb enough to be a liberal? Maybe he just changed the printer paper or something, rather than anything requiring actual intelligence?
Another Democrat crook paying protection money to the Thug Party....while the biggest crook of them all, Harry Reid, castigates the Koch brothers as evil Republicans who legally contribute to the GOP. And they also build hospitals and provide scholarships to Back college students with their millions.
Levin and McCain? I thought it was bi partisan?
When you are about to arrive to wealth, you look for the key to the gate to evade/avoid taxes. Paying the democrats gets the key more often than not. Pay the republican establishment fat cats only when they are in power or include them in on the deal to broker it with their colleagues ‘across the aisle’.
Apparently this fellow didn’t pay off the right people or enough people. He’s worth 15B so fat cats look at him like a mark.
Pass the FairTax and all this nonsense goes away while everyone including the rich then pay taxes they’re supposed to pay.
Now the HuffPo’s recent outburst can be seen for what it was, cover fire.