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August 31, 2011
Warren Buffett's IRS problems
The past few weeks have been very busy, very productive for super-rich multi, multi billionaire Warren Buffett. He wrote a widely publicized, widely mocked (or praised depending on your viewpoint) op-ed in the New York Times titled "Stop Coddling the Super-Rich," advocating higher taxes for people like himself--super-rich. He spoke to President Barack Obama (D). He spoke to the president of troubled Bank of America, the largest bank in the country. The next day he invested $5 billion in BofA, generating a 6 o/o interest rate for him; compared to slightly over 2 o/o available from US Treasuries this is very good. And yesterday he celebrated his 81st birthday.
Commenting on Buffett's op-ed and actions, I joked that Buffett would certainly practice what he preached, voluntarily sending a generous check to the US Treasury Department and instruct his accountants to ignore legal, tax reducing deductions, knowing full well he wouldn't. Oh, how right I was.
"has been in an almost decade-long dispute with the IRS over how much taxes it owes, these same press members couldn't care less:
According to Berkshire Hathaway's own annual report -- see Note 15 on pp. 54-56 -- the company has been in a years-long dispute over its federal tax bills.
According to the report, "We anticipate that we will resolve all adjustments proposed by the U.S. Internal Revenue Service ('IRS') for the 2002 through 2004 tax years at the IRS Appeals Division within the next 12 months. The IRS has completed its examination of our consolidated U.S. federal income tax returns for the 2005 and 2006 tax years and the proposed adjustments are currently being reviewed by the IRS Appeals Division process. The IRS is currently auditing our consolidated U.S. federal income tax returns for the 2007 through 2009 tax years."
Americans for Limited Government researcher Richard McCarty, who was alerted to the controversy by a federal government lawyer, said, "The company has been short-changing the tax collection agency for much of the past decade. Mr. Buffett's company has not fully settled its tax bills from 2002-2009. Yet he says he'd happily pay more. Except the IRS has apparently been asking him to pay more going on nine years." "
Does President Obama know about this? Hmmm.
Does Obama still want Buffett to host a fund raiser for him? Probably.
Will Buffett and Obama continue their class/wealth war against their super rich opponents, such as oh, Donald Trump, Charles Koch or maybe even George Soros, the Kennedys and John Kerry demanding sacrifices from them? No doubt--except or the latter three of course.
Full disclosure: as an extremely, extremely minor stockholder in Berkshire Hathaway but one willing to participate in shared sacrifice, I not only highly recommend that BH settle with the IRS immediately, I also strongly suggest that Buffett practice what he preaches by voluntarily disbanding his tax sheltered foundation which allows Buffett to direct his money where he wants, rather than the government. Proving he walks the walk of his talk, Buffett can also voluntarily donate to the US government; it is so easy that his many accountants engaged in fighting the IRS over BH's tax obligations will certainly be happy to engage in more productive, more positive work.
And I'm sure Warren Buffett will too.
So happy birthday Warren Buffett. Remember, you're not getting older, you're getting better.
Robert Romano, senior editor at Americans for Limited Government informs us that Buffett's total tax bill is more than $1 billion. Pay up or shut up, Warren.
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