Congressional Republicans effectively cut taxes for rich individuals when they passed their tax cuts for corporations as the package included generous tax cuts for pass-through income and S corporations.
The Trump Organization, for example, is one such corporation. The GOP's tax cuts were a massive tax cut for Trump himself and his family, but there's a loophole within the new law that could allow Trump to avoid paying any taxes at all on a significant portion of his business.
Citizens for Responsibility and Ethics in Washington (CREW) have identified a new loophole that could allow the Trump Organization and similar businesses to defer taxes on foreign income indefinitely or until the corporation is dissolved.
But, another lucrative loophole, one designed precisely for businesses that are organized as pass-throughs and make money abroad, has largely escaped notice. President Trump has numerous foreign-based entities, such as DJ Aerospace Limited incorporated in Bermuda, Turnberry Scotland LLC incorporated in Turnberry, Scotland, TIGL Ireland Enterprises Limited incorporated in Doonbeg, Ireland, and THC Barra Hotelaria TLDA incorporated in Brazil, are likely Subchapter S Corporations, which means that this loophole will almost certainly directly benefit him.
This new loophole allows shareholders of pass-through entities to pay zero tax indefinitely on their foreign income. This is even more generous than the terms afforded to Subchapter C Corporations, the corporate form commonly used by publicly traded companies, whose income is taxed at the corporate level. Under the new tax bill, C Corporations receive a not-too-stingy eight years to spread out the tax liability for foreign income. Rather than spreading out payment of income tax over eight years, Shareholders of S Corporations pay not a penny in tax on unlimited amounts of foreign income until an indefinite point in the future when the S Corporation dissolves, the S Corporation liquidates substantially all of its assets, or until the shareholder decides to transfer the shares or dies.
It's the last provision in this that really catches my attention.
According to CREW, even the death of the primary shareholder may not trigger taxes on foreign income. If the heir of the company assumes control, the heir or new majority shareholder may continue deferring taxes indefinitely.
So, using Trump and his family as an example, Trump could pass ownership to Ivanka and never have to pay taxes on any of their foreign income. Ever.
That catches my attention because the New York Times just recently reported that Trump's father passed over a billion dollars to his children through illegal schemes that sheltered the money from taxes. In this case, Trump could pass money to his children without paying taxes on it using a loophole passed into law by congressional Republicans.
They've legalized a scheme that made Trump rich in first place.
Every single talking point Trump or the GOP have ever uttered about "the elites" really comes down to this: they've created all new tax shelters for the elite.