Bloomberg: Hedge Funds Exploit Trump Tax Loophole By Registering LLC’s In Delaware

Filed in Delaware, Featured, National by on February 14, 2018

When all else fails, the wealthy always have Delaware LLC’s to shelter their ill-gotten gains. (And to pay off porn stars, but that’s a story for another day.)

This Bloomberg report spells out how hedge funds are exploiting Delaware law to avoid paying taxes on their profits. It’s disgraceful. Here’s their modus operandi:

Since late 2017, hedge fund managers have created numerous shell companies in the First State, corporate America’s favorite tax jurisdiction. These limited liability companies share a common goal: dodging new tax rules for carried-interest profits through a bit of deft legal paperwork.

Big names appear to be embracing the maneuver, which requires setting up LLCs for managers entitled to share carried-interest payouts. Four LLCs have been created under the name of Elliott Management Corp., the hedge-fund giant run by Paul Singer. More than 70 have been established under the names of executives at Starwood Capital Group Management, the private-equity shop headed by Barry Sternlicht.
Someone cue the GIF of Jeff Bullock shrugging his shoulders in his classic ‘there’s nothing I can do’ manner.
Well, yes there is. There is simply no excuse for the General Assembly not to increase fees for LLC licensure.  Only in Delaware can someone with penny-ante LLC’s like Rep. Bryon Short prevent increases that would at least make the criminals who are safely house there pay a little more for their perfidy.  Rep. Kowalko has introduced such legislation. Short’s crocodile tears kept the House from considering that bill last year.  Gee, maybe we can carve out yet another exemption for members of the General Assembly, and then maybe we can get a vote on the bill.
Please spare me any of John Carney’s lamentations over how we have no choice but to cutcutcut.  We don’t. He knows it, we know it.  All he has to do is take the initiative. For once.

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  1. jason330 says:

    “Semper Pimping!”

  2. RE Vanella says:

    “I smelled the stink that only a street whore has after a long, busy night.”
    –Iceberg Slim

  3. Alby says:

    The trick would be to declare it abandoned property if the accounts go untouched for seven or more seconds. Budget problem solved.

  4. they are all corrupt says:

    Delaware where politically corrupt, and drug dealers come to hide money…oh an payin off porn stars.