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posted by martyb on Monday December 05 2016, @05:19AM   Printer-friendly
from the perfectly-legal-loopholes dept.

Drew Harwell over at the Washington Post has an interesting story about a tax loophole that could allow Trump appointees to avoid paying millions in taxes.

President-elect Donald Trump's ultra-wealthy Cabinet nominees will be able to avoid paying millions of dollars in taxes in the coming weeks when they sell some of their holdings to avoid conflicts of interest in their new positions.

The tax advantage will allow Trump officials, forced by ethics laws to sell certain assets, to defer the weighty tax bills they would otherwise owe on the profits from selling stock and other holdings.

The benefit is one of the more subtle ways that the millionaires and billionaires of Trump's White House, which already will be the wealthiest administration in modern American history, could benefit financially from their transition into the nation's halls of power.

The legal tax maneuver, offered for years to executive-branch appointees and employees, was designed to help ease the sting of being forced to suddenly sell investments.

But the federal program, encoded in Section 2634 of federal ethics laws and known as a "certificate of divestiture," has never been tested quite like this. Trump's Cabinet picks have amassed assets worth billions of dollars from lifetimes in banking and investing, much of which they will be able to sell tax-free.


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  • (Score: 3, Insightful) by Anonymous Coward on Monday December 05 2016, @05:41AM

    by Anonymous Coward on Monday December 05 2016, @05:41AM (#437064)
    Starting Score:    0  points
    Moderation   +3  
       Insightful=2, Informative=1, Total=3
    Extra 'Insightful' Modifier   0  

    Total Score:   3  
  • (Score: 2) by timbim on Monday December 05 2016, @06:12AM

    by timbim (907) on Monday December 05 2016, @06:12AM (#437068)

    "certificate of divestiture," has never been tested quite like this.

  • (Score: 3, Insightful) by bob_super on Monday December 05 2016, @06:16AM

    by bob_super (1357) on Monday December 05 2016, @06:16AM (#437070)

    > will be the wealthiest administration in modern American history

    People care because someone got elected on a wave of discontent at dishonest elites gaming the system.

    • (Score: 5, Informative) by Whoever on Monday December 05 2016, @06:33AM

      by Whoever (4524) on Monday December 05 2016, @06:33AM (#437075) Journal

      People care because someone got elected on a wave of discontent at dishonest elites gaming the system.

      ... and get a bunch of people who will be even worse. Even more elite.

      The articles linked in the GP post describe most of Obama's cabinet (with a small number of exceptions) having a net worth that would barely get them in the top 5%. Not even close to the top 1%.

      • (Score: 0, Offtopic) by Anonymous Coward on Monday December 05 2016, @06:43AM

        by Anonymous Coward on Monday December 05 2016, @06:43AM (#437078)

        So a bit of corruption is okay. A mere trifle that Geithner had to pay $34,000 in back taxes before he could oversee the IRS.

        Gotcha.

        Oh, and if you have a computer (which I assume you do) and make at least $32,400, you are in the top 1% worldwide.

        http://www.investopedia.com/articles/personal-finance/050615/are-you-top-one-percent-world.asp [investopedia.com]

        • (Score: 3, Informative) by Anonymous Coward on Monday December 05 2016, @06:53AM

          by Anonymous Coward on Monday December 05 2016, @06:53AM (#437083)

          Stop it with this "oh yeah, well what about blah blah blah".

          No one cares.

          Whats important here is Trump got elected on the basis of stopping exactly this sort of thing.

          He was going to drain the swamp, remember? Not THROW MORE SWAMP IN!

          • (Score: 0, Disagree) by Anonymous Coward on Monday December 05 2016, @07:02AM

            by Anonymous Coward on Monday December 05 2016, @07:02AM (#437086)

            In case you've been living under a rock, you might have noticed Trump hasn't even taken office yet.

            A bit hard to drain the swap when you haven't even been there.

            While his appointments haven't filled me with everlasting joy, it has really been no better or worse than any other administration that i can tell.

            And unless you share your crystal ball, I'd prefer not to make any judgements on what might happen just yet.

            • (Score: 0) by Anonymous Coward on Monday December 05 2016, @10:54AM

              by Anonymous Coward on Monday December 05 2016, @10:54AM (#437120)

              Wondering what form this draining of the swamp may take. All the same idiots are in Congress. Honestly not sure what to expect either. A lot of us didn't like him in spite of how charismatic he is just because he didn't have any concrete goals and couldn't quite articulate what a drained swamp would look like.

              But ultimately you're right. I wish the media would stop hyperventilating already. What's done is done. He was the "we need to elect him to see what's in his platform" candidate. Seeing how well that worked with the ACA, it doesn't leave me with a lot of hope. I'm thinking in 3 years or so there's going to be a lot of interesting points to be made comparing posts from now with what actually happens.

            • (Score: 3, Insightful) by Phoenix666 on Monday December 05 2016, @02:32PM

              by Phoenix666 (552) on Monday December 05 2016, @02:32PM (#437153) Journal

              I agree with you to an extent, but I would caution everyone to not surrender to the temptation of double-standards and apologia. We can't afford it. Instead of arguing about whether we ought to hold a Republican-controlled government to an exacting standard versus holding a Democrat-controlled government to an exacting standard, let's hold government to an exacting standard, period. If we can do that dispassionately, even better.

              --
              Washington DC delenda est.
          • (Score: 2) by TheRaven on Monday December 05 2016, @12:33PM

            by TheRaven (270) on Monday December 05 2016, @12:33PM (#437130) Journal
            Really? Because I remember Trump, during his campaign, saying that you'd have to be an idiot not to do everything in your power to avoid paying taxes. He didn't seem concerned that tax avoidance is much easier for the likes of him with large amounts of money than for the majority of the population.
            --
            sudo mod me up
            • (Score: 0) by Anonymous Coward on Monday December 05 2016, @02:25PM

              by Anonymous Coward on Monday December 05 2016, @02:25PM (#437150)

              What got Trump elected was that he was willing to be on all sides of every issue so voters could pick and choose the version of Trump they wanted to vote for.

              He didn't actually expect to get elected so promising everyone what they wanted in the ultimate caricature of a politician had no downside.

              But now he's being held to account for his words, and that means practically everything he does will make him a hypocrite.

          • (Score: 0) by Anonymous Coward on Monday December 05 2016, @02:41PM

            by Anonymous Coward on Monday December 05 2016, @02:41PM (#437157)

            HE HAS DONE NOTHING, this is a fucking speculative article. The word "Could" is a dead give away. What a waste of my time even reading this line. This is classic left-wing bull-shit "journalism." I "could" rob a bank, and I "could" set a hobo on fire. Come back to me with facts assholes.

  • (Score: 0) by Anonymous Coward on Monday December 05 2016, @06:50AM

    by Anonymous Coward on Monday December 05 2016, @06:50AM (#437082)

    Because as pointed out elsewhere in the thread...

    "People care because someone got elected on a wave of discontent at dishonest elites gaming the system."

    You know drain the swamp etc?

    Trump got elected on the basis of stopping this sort of thing.

    • (Score: 1, Insightful) by Anonymous Coward on Monday December 05 2016, @08:53AM

      by Anonymous Coward on Monday December 05 2016, @08:53AM (#437105)

      He's obeying the law. The law is written the way it is, and was for a long time before he came along.

      How does obeying the law make him dishonest? Wait, before you spin yourself into a tornado trying to answer that, let me help you: it doesn't.

      If he'd lobbied for this law and got it passed six months ago, I might have thought you were on to something.

      But he didn't. And it wasn't. And you aren't.

      • (Score: 1, Insightful) by Anonymous Coward on Monday December 05 2016, @02:20PM

        by Anonymous Coward on Monday December 05 2016, @02:20PM (#437149)

        > How does obeying the law make him dishonest?

        He didn't campaign on sticking to the letter of the law. He campaigned on the fact that the law was too permissive.
        The entire "swamp" is completely legal. He still promised to "drain" it.
        He needs to do better than the law in order to live up to his rhetoric.

        • (Score: 0) by Anonymous Coward on Monday December 05 2016, @03:46PM

          by Anonymous Coward on Monday December 05 2016, @03:46PM (#437189)

          This comment should address many posts above. A drain the swamp example in two words... Clinton Foundation.

          • (Score: 0) by Anonymous Coward on Monday December 05 2016, @03:50PM

            by Anonymous Coward on Monday December 05 2016, @03:50PM (#437194)

            Since no one asked for an example, its hard to figure out what your point is.
            This has nothing to do with clinton. She's not in the picture any more.

            • (Score: 0) by Anonymous Coward on Monday December 05 2016, @06:22PM

              by Anonymous Coward on Monday December 05 2016, @06:22PM (#437292)

              Clinton Foundation... How to make millions behind a loophole.

              • (Score: 0) by Anonymous Coward on Monday December 05 2016, @07:42PM

                by Anonymous Coward on Monday December 05 2016, @07:42PM (#437342)

                Trump University... How to defraud thousands of people behind a loophole.

                See, we can play this game all day long.

    • (Score: 0) by Anonymous Coward on Monday December 05 2016, @02:13PM

      by Anonymous Coward on Monday December 05 2016, @02:13PM (#437148)

      You know drain the swamp etc?

      What people fail to realize is, he was talking about draining the swamp only because he wanted to put a golf course there.