Jamie and Frank McCourt made $108 million from 2004 through 2009 but paid no federal or state income taxes. The secret lives of the rich and infamous came to light when the couple filed for divorce in Los Angeles County Superior Court. According to Michael Hiltzik of the LA Times:
The court papers indicate that the McCourts deliberately structured their business at least partially to allow them to live tax-free ...According to court papers files by Jamie McCourt, Frank manipulated business accounts to make himself look $670 million poorer than he is. Cheating the IRS may be legal, but ...
According to Jamie, the McCourts employed two mechanisms to live tax-free. One was to claim enormous tax losses from their business, which was mostly commercial real estate before they bought the Dodgers. These could be carried forward, offsetting income year after year until they were finally netted out ...
Depreciation is a non-cash expense that can be applied against cash income, reducing your income taxes or creating a loss to show the tax man, even though you're making money. It's common in real estate, though it can also be applied to things like a sports team's player contracts ...
Another McCourt maneuver involves financing and refinancing their assets. The tax rules allow real estate owners to refinance properties with rising values and take out cash tax-free ...
The McCourts have also borrowed against future business income -- in 2007 they took out a $140-million loan against future Dodger ticket sales, of which $20 million went to fund their lifestyles, tax-free.
Perhaps our good friend and honorary cephalopod, AZRainman, should have the last word …Heaven has no rage like love to hatred turned
Nor hell a fury like a woman scorned.
Alternative title: Dodger owners are tax dodgers.
ReplyDeleteYes, Yes, Yes....
ReplyDelete"NOL" or net operating loss...
You can carry over your losses from one year to the next and apply them to future earnings.
Companies that have an NOL are also very attractive purchases for companies facing a high tax bite.
Have assets that are fully depreciated then sell them to a shell company and the depreciation starts all over again!
The accounting tricks that are the basis for all the wealth in this country!
That's just obscene.
ReplyDeleteIs anyone surprised? And still the D-baggers yell and scream and the minimum wage workers cry about inheritance taxes and how high the upper bracket folks are taxed.
ReplyDeleteThere's never been such mass insanity in American History
And by the way, did you know Obama is a Muslim?
Jamie and Frank McCourt made $108 million from 2004 through 2009 but paid no federal or state income taxes.
ReplyDeleteI am intrigued by their ideas and would like to subscribe to their newsletter.
The money these bastards cheated out of the Government could have gone toward several days of death and destruction in Afghanistan. Outrageous!
ReplyDeleteI am not in the least surprised. It does however, bring out my vindictive and violent thought processes, i.e., fingers firmly planted around skinny and arrogant necks...mine.