ATTENTION CONGRESS: CLOSE THE LOOPHOLE: Hedge Fund Manager John Paulson Earned $5 Billion In 2010, Paid Only 15% Tax

Wonkroom

Last year was very lucrative for some of the biggest and best-performing hedge funds’ chiefs. Wealth was so concentrated that a mere 25 people pocketed a total of $22.07 billion, according to this year’s annual ranking by AR Magazine, which tracks the hedge fund industry. At $50,000 a year, it would take the salaries of 441,400 Americans to match that sum.

Making matters worse, hedge fund managers benefit from preferential tax treatment that middle-income Americans don’t. Due to what’s known as the carried-interest loophole, the income that hedge fund managers receive if their funds make money is treated as capital gains — rather than ordinary income — and gets taxed at the capital gains rate of 15 percent. Even though the pay is performance-based compensation (just like any other performance-based bonus made by any other worker), hedge fund managers receive a tax break on that income.

This results in hedge fund managers paying less in taxes on this income than middle-class workers, who are subject to a 25 percent top marginal tax rate.

Sources:

Wonkroom

New York Times

Comments

[j r]

Nobody "earns" $5,000,000,000, they steal it.

[LiberatedCitizen]

The income inequality is worse in the U.S. then it was in Egypt were the ones who need a revolution it's downright sickening the working stiff American's have to foot the bill for foreign aid, welfare for the rich and the poor pretty soon there will be no middle class but then that's the plan to bring us down to third world status and don't you be fooled they have infiltrated all area's of business, including bankers and political affiliations. They started as Fabian Socialists - Mises warned about them. There's a great old video that people should watch.

http://econproph.com/2011/01/29/income-inequality-worse-in-us-than-egypttunisia/

The Capitalist Conspiracy

http://video.google.com/videoplay?docid=-8776565732112929514#docid=6260646431723948415

Mises warned

http://www.garynorth.com/public/5156.cfm

Clinton, Quigley, and the New World Order

http://www.theendrun.com/clinton-quigley-and-the-new-world-order

The movie explains how it may seem a direct contrast to peoples thinking that they would want to destroy Capitalism but the men doing it are not true Capitalists they want to rule you will share the pain they will share the gain.

[Christina Marlowe]

THANK YOU FOR THE LINKS...

[expat]

These are the type of people who spkr/house "boner" was/is holding congress captive over why is this OK with 98% of the herd?
It was the very first thing he did taking over,what happened to the "tea party" are they ALL in the top 2%?
IT makes no difference who in charge. Geo. Carlin was right;" its a big club and your not in it,they don't give a fuck about
you"!

[Senka]

The time has come to speak up and never let go until those Wall Street "great minds" are brought to justice. They stole our homes, our pensions, our life savings. They erased everything we built while they are enjoying their enormous salaries and privileged lives. The time has come America, to stop watching reality tv, like Jersey Shore or Charlie Sheen's demise and start engaging in your reality which is, due to those crocks, grimmer every day.
http://boston67.blog.com/mortgagewall-street-alert/

[Howard T. Lewis III]

Hedge fund wizard? Isn't that some ortho product for compost enrichment?

[DDearborn]

Hmmm

It is not just the 15% INCOME tax rate (they actually pay less after all their deductions) it is the fact that Social security taxes are capped as well. Make these people pay social security on 100% of the GROSS INCOME just like all the rest of us. And given that there are only a few thousand of these super rich tax dodgers they should audited AUTOMATICALLY every single year. And of course the dividend and interest tax should be raised BACK to 35% as well. These simple changes to just a few hundred thousand people would bring in several HUNDERD BIILLION in revenue every year! So for the sake of 295 MILLION POOR people taking a bit more from the super rich is not just fiscally responsible and logical, it is the right thing to do.
SO WHY WON'T OUR REPRESENTATIVES IN WASHINGTON DO IT???????????????

[G Street]

This is a good example of why the current meme of "shared sacrifice" is crap. We've been sacrificed for years. We tightened our belts, got trickled down on, sucked it up, competed with China and company, got outsourced and insourced. Our wages flatlined decades ago. Our 401K got whacked. Healthcare is just a pipe dream. All the while the rich did just fine.

It's time the rich and their poodles in Washington STARTED sharing the sacrifice. I've already paid.

[Dave Mowers]

Every penny of their money was stolen from honest people who actually work for a living. Without political corruption and wall street fraud they would have nothing because they do nothing. These people should be killed and their wealth confiscated and returned to the U.S. Treasury.

Every single day there is another report detailing how common fraud is the way Wall Street, the stock market, investment banks and legislators really "make" their money. They rig the stock market in collusion with market makers, that is what high frequency trading is. They print short shares that don't exist. Sell bonds on home mortgages up to forty times per bond! All of finance is leverage deals that are truly and act of fraud, defrauding investors. Even the gold price is bogus, they don't trade in physical gold, they trade in paper shares or digital entries. None of this is real but ALL of it makes one class richer at the expense of the others. The idea that you can participate and also get rich is a lie, you are a sucker getting feed cyanide laced kool-ade. Without a continuous supply of losers they market will crash. The market is crashing now due to government pension funds being net sellers for the first time in history and it is not going to change. If you invest in this market you are a fool.

[BILLY-BOB GARCIA]

I don't like any of these crooks either, but 15% of $5B is $750,000,000.00 in taxes.
I have a hard time wanting anyone to pay more than that in taxes. The real problem is the fiat money system that allows anyone to make $5B shuffling paper around.

[Sick of it all]

Just think what the children of our political elite get when they go to work at these hedge funds. Quid pro quo.

[Sick of it all]

A 250 grain .338 lapua round travels at 2,850 fps (fee per second) I'm personally not advocating this but maybe we should start taking target practice a bit more seriously. We do have a target rich environment.

[nopbzv nopbzv]

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[loans]

freelance writer