Instead of paying ordinary rates on much of their income — typically 35 percent for the highest bracket (39.6 percent for this tax year) — these executives pay the capital gains rate of 15 percent. It’s a clear loophole that is plainly unfair. Despite repeated efforts to repeal it, the loophole has remained, in part because of well-financed industry lobbying in Washington. [...]In fact, screw that—don't you wish you were a corporation? They're like people, but better. They have superpowers.
But much of the lobbying isn’t coming from the private equity industry — it’s coming from another beneficiary that often goes overlooked: the real estate industry. [...] That means not just private equity and hedge funds, but also venture capital and much of the oil and gas industry.
If individual taxpayers are arrested, admit guilt and reach a civil settlement with the government, they cannot deduct the costs from their returns. But amazingly, a company is allowed to claim those costs as a business expense. JPMorgan Chase, for example, which has agreed to pay billions of dollars in fines for various transgressions, can deduct a large portion — and all the legal expenses — from its taxes.Which is a neat trick. If you were to engage in financial shenanigans like, say, laundering billions of dollars of narco-terrorist money you would land yourself in the pokey. If a corporation does it the government simply asks for a cut of the take and sends you on your way. Then you get a tax break.
Anyway, Happy Tax Day. You should feel proud that at least you are doing the most basic of things to fund the roads and bridges and armies and national parks and law enforcement that we have all, in our collective national wisdom, decided are good things worth having in a civilized country. Not everyone can say the same.