On Tax Day this year, President Biden once again bragged that he released his tax returns—as if that alone proves his integrity. But to paraphrase Winston Churchill, Biden should be more modest about his tax behavior, because he has much to be modest about.
The record not only shows that Biden and his wife used a loophole to avoid payroll tax payments that fund Social Security, Medicare, and Obamacare. It also strongly suggests that Joe Biden abused that loophole, in ways that led to deliberate and significant underpayments of taxes.
Because of those actions, and the evidence supporting this account, I recently filed complaints with the Internal Revenue Service against both Biden and his accountant regarding their actions. If and when Republicans take control of Congress next year, they should follow up by investigating Biden’s questionable conduct.
Rank Hypocrisy
Upon leaving the vice presidency in 2017, Biden and his wife Jill funneled their book and speech income through two S-corporations. By characterizing more than $13 million of that income as corporate profits rather than wages, the Bidens avoided paying more than $500,000 in payroll taxes.
Ironically enough, the Biden administration has proposed closing this very loophole, with the Treasury claiming it allows individuals with “high incomes to avoid paying their fair share of taxes.” Democrats in Congress have similarly proposed closing the “Biden loophole” in their $5 trillionBuild Back Bankrupt legislation. While Biden previously exploiting a loophole he now wants to close makes him a hypocrite, it doesn’t automatically make him a tax cheat.
Legal Violations
But Biden paid himself such a low salary that multiple tax experts believe he violated federal tax guidelines. For starters, in 2017 Biden paid himselfa 37 percent lower salary—just under $150,000—than the $230,700 he received as vice president. To ask the obvious question: What Washington dignitary earns less after leaving office than he earned while serving in the federal government?
In this case, the answer is equally obvious: The lower the salary Biden paid himself, the more money he could classify as corporate profits—and the more in payroll taxes he could avoid. Little wonder then that, on an inflation-adjusted basis, Biden in 2017 paid himself less than the annual salary he received in each of 46 of his years of service as a senator and vice president.
Biden underpaid himself relative to his peers, too. Data from the IRS’ Statistics of Income show that in 2017, firms with the same amount of revenue as Biden’s corporation—companies with between $5 million and $10 million in revenue—paid their executives salaries averaging 33.6 percent of net income. By comparison, Biden paid himself a salary of only 1.51 percent of his company’s net income in 2017, and 9.9 percent of his company’s net income in 2018, indicating he was deliberately underpaying his salary to avoid payroll taxes.
R&I – FS
DarkGoldenMan
Article URL : https://thefederalist.com/2022/05/09/how-congress-should-investigate-joe-bidens-taxes/