Corker to Vote Yes on Tax Bill Following Revision Giving Him a Break

Mish

Senator Corker, the only Republican voting against the Tax bill, just changed his mind. Why? He benefits personally!

Wow! Great Job!

The International Business Times reports Donald Trump and GOP Leaders Could be Enriched by Last Minute Tax Break Inserted Into Final Bill.

Republican congressional leaders and real estate moguls could be personally enriched by a  real-estate-related provision GOP lawmakers slipped into the final tax bill released Friday evening, according to experts interviewed by International Business Times. The legislative language was not part of previous versions of the bill and was added despite ongoing conflict-of-interest questions about the intertwining real estate interests and governmental responsibilities of President Donald Trump — the bill’s chief proponent.

The Trump organization and the Kushners (the family of Ivanka's husband, Jared) have overseen vast real estate empires, and top GOP lawmakers writing the tax bill collectively have tens of millions of dollars of ownership stakes in real-estate-related LLCs. The new tax provision would specifically allow owners of large real estate holdings through LLCs to deduct a percentage of their “pass through” income from their taxes, according to experts. Although Trump, who became famous for his real estate holdings, has transitioned into branding in recent years, federal records show Trump has ownership stakes in myriad LLCs.

Sen. Bob Corker, who was considered a potential “no” vote on the bill, abruptly switched his position upon the release of the final legislation. Federal records reviewed by IBT show that Corker has millions of dollars of ownership stakes in real-estate related LLCs that could also benefit.

“Pass-throughs” are business entities that don’t pay corporate income taxes, like partnerships, LLCs and S-Corporations. Instead, they “pass through” income to partners, who then pay personal income taxes on the money they receive. The Senate version of the tax bill would have added a 23 percent deduction for income from pass-throughs to the tax code. The new reconciled tax bill shrinks that deduction to 20 percent but, in a last-minute change, added a new way around restrictions that would have kept pass-throughs with large income but few employees from benefiting.

Who Benefits? Me!

As I noted before, I benefit from this legislation, but not because of real estate. The Tax Foundation explains.

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100% of my income is pass-through.

Unlike Corker, I am not changing my opinion. I think this bill, which adds $1.5 trillion in debt while doing virtually nothing to spur investment or jobs, is grossly beneficial to the wealthy.

To voice your displeasure at unprecedented greed, please see Upset About the One-Sided Tax Bill? Here's What to Do About It!.

Mike "Mish" Shedlock

Comments (4)
No. 1-4
cecilhenry
cecilhenry

Reduce income taxes on productive people. Make a flat tax. The middle class is endlessly parasitized. Put money in the hands of the people who WORK and EaRN it. REducing taxes is right, START with income taxes. Tired of being slave. A serf only paid 10% in taxes. WE pay 50. To hell with this.

Hooligan
Hooligan

the estimated tax take is 3.7 trillion for 2018 here: https://www.thebalance.com/current-u-s-federal-government-tax-revenue-3305762 Assuming that the tax take goes up in line with nominal GDP AND that nominal GDP will be 4% (always ranging between 1-3% inflation ad 1-3% real growth) - the cumulative tax take over the next ten years will be around 50 trillion dollars.(tax take in year 10 will be around 5.5 trillion) 1.5 trillion means the tax cuts in this bill are a meagre 3%. GDP over the ten years (assuming 4% nominal growth and a 20 trillion starting point) will have been a cumulative total of 210 trillion dollars (finishing in year 10 at around 30 trillion dollars). so, this is not a big deal in terms of total taxes raised and in terms of gdp impact it makes a difference of around one half of one per cent over ten years = 5 basis points of fiscal/government per annum for ten years, which will immediately get consumed by tax payers for a complete offset between the G and C components of C+G+i+(X-M) = GDP calculation. the problems with the deficit and debt are nt materially impacted by this "boondoggle" - it is 4.4 trillion a year of government spending that needs to be cut by 20% - probably across the board to balance the books and to begin repaying government debt.

El_Tedo
El_Tedo

I'm appalled that Mish would call into question the integrity of an elected office, sworn to defend the constitution and the interests of his constituents.

Mike6712
Mike6712

The bill does get rid of the AMT, and that's some progress.


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