New IRS Regulations: Maybe TCJA Really Was Bad For President Trump And Some Wealthy Friends
To make up an extreme example consider Bruno Bigbuilding. Bruno supports his family with a modest $10 million salary that he takes from his development and management company. His net worth is close to a billion and it is based on real estate interests in which he is 90% leveraged. That produces a lot of depreciation, the deduction that President, then developer, Trump said he loves so much in The Art of The Deal:
“I don’t have to please Wall Street, and so I appreciate depreciation. For me the relevant issue isn’t what I report on the bottom line, it’s what I get to keep.”
After sheltering the income from the real estate, there will be plenty left over to shelter the $10 million salary. Not anymore.
Ninth Circuit Pulls Back Big IRS Victory Issued After Judge’s Death
But, but, but, the case is not a win for the IRS as of today. It is back in limbo. Because unlike the stories you hear about Chicago, it seems that in the Ninth Circuit they don’t want the dead to vote. One of the two votes in favor of the IRS was cast by Judge Stephen Reinhardt who died on March 29, 2018, almost four months before the decision issued.
Follow Me
Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.