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Author Topic: Power Structures in Human Society: Pros and Cons Part 1  (Read 8584 times)

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AGelbert

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GRAT Socialism for the RICH
« on: January 05, 2014, 09:54:36 pm »
 http://www.youtube.com/watch?v=U9cat-kJhgw&feature=player_embedded
Grantor Retained Annuity Trust

Smile, the billionaires and millionaires are paying less taxes than YOU!  :evil4:

Here's just ONE that uses GRAT extensively:
Sheldon Adelson



One of his dwellings...


Marina Bay Sands Resort owned by Sheldon Adelson

Socialism FOR THE RICH is the American WAY!
Ultra-Wealthy Dodge Billions in Taxes Using "GRAT" Loophole

December 20, 2013 01:06 PM | Permalink | Bookmark and Share
A new Bloomberg report describes how billionaires have dodged an estimated $100 billion in gift and estate taxes since 2000, according to the lawyer who perfected the practice.

The trick involves temporarily putting corporate stocks (or similar assets) into a “Grantor Retained Annuity Trust” (GRAT), where the grantor gets the stocks back after two years, plus a small amount of interest, while any appreciation of the stock goes to the grantor’s heirs tax-free.

Because the initial gift has no inherent value (it’s essentially a gift to oneself), there is no gift tax at the time the GRAT is set up. The loophole is that the appreciation of the stock that goes to the heirs is not subject to gift tax either. As a result, extremely wealthy individuals avoid billions of dollars in gift and estate tax.

This is what Sheldon Adelson did (to take just one example) when he put much of his Las Vegas Sands stock in GRATs when the stock had plummeted during the recession. Adelson knew that the stock was likely to rise significantly from that low point. If Adelson had simply given his heirs the stock, the gift tax would have  applied to the value of the stock at the time it was given. Or if he bequeathed the stock upon his death, the estate tax would apply.

But by using GRATS, neither the value of the stock at the time it was temporarily put into the GRAT nor the subsequent appreciation was subject to gift or estate tax. See the graphic (at link below) from Bloomberg for how the shelter works :evil4:  in practice.

http://www.ctj.org/taxjusticedigest/archive/2013/12/ultra-wealthy_dodge_billions_i.php


 
http://www.youtube.com/watch?v=WEz4vszCwpU&feature=player_embedded

In today’s On the News segment: The super rich have skipped out on paying $100 billion dollars in estate taxes since 2000; Americans are working harder than ever, but most people won't be seeing a larger paycheck; as renewable energy becomes more popular, the oil and gas industry is getting scared; and more.

TRANSCRIPT:

I'm Jim Javinsky - in for Thom Hartmann – on the news…

You need to know this. The super rich have skipped out on paying $100 billion dollars in estate taxes since 2000. And, that incredible number doesn't even factor in the billions that they saved using loopholes like capital gains, or by stashing their money in tax havens around the world.

A new report from Bloomberg News says that special tax loopholes used primarily by the super rich have made the estate tax system “essentially voluntary” for those at the top. Basically, billionaires like Shelly Adelson and the Walton family set up special trust funds, like the Walton-created “grantor-retained annuity trust” or GRAT, in which they stash millions of dollars worth of stock. Once those GRATs expire – typically after two years – the billionaires cash out the stock, keep their original investment, along with a profit, and pass on the balance to their heirs. All the while, avoiding taxes on the whole scheme.


By using these completely legal, but highly unethical, tactics, the super wealthy have stashed away $100 billion in a little over a decade. That amount is enough to pay for every child in our nation to go to preschool for ten years, and it could wipe out the entire first round of sequester cuts.

One hundred billion could have provided a substantial benefit to our nation, and it's only one of many tax loopholes that the super rich use to get out of paying their fair share. The super rich like to call estate taxes “death taxes,” but trust-fund schemes like this that are actually killing investment in our nation. If billionaires want to do business in our great nation, it's about time that they start contributing to the commons that make it possible.

Here's some more WELFARE QUEENS:

Facebook Billionaires Used GRATs to Save $200 Million in Gift Taxes

http://taxprof.typepad.com/taxprof_blog/2012/05/facebook-billionaires.html
Hope deferred maketh the heart sick: but when the desire cometh, it is a tree of life. Pr. 13:12

 

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