Last night, “Middle Class Joe” Biden released two years’ worth of tax returns, revealing that in 2017 and 2018, the vice president earned $15 million, much of it thanks to a book deal and 47 speaking engagements, which commanded six-figure fees.
But as it turns out, Biden – who has repeatedly attacked President Trump for his use of tax loopholes during his career as a developer – took advantage of a loophole that he and President Obama had tried to close during their time in office, as WSJ reports.
Biden and his wife, Jill Biden, the former second lady, routed their book-deal earnings through an S-Corp, a pass-through entity that allowed the two to avoid a self-employment tax of 3.8%. While that might not seem like much, the Bidens’ saved $500,000 thanks to the strategy.
According to a tax expert quoted by WSJ, there was “no reason” why the Bidens’ needed to use an S-Corp, aside from saving on their tax bill.
“There’s no reason for these to be in an S corp – none, other than to save on self-employment tax,” said Tony Nitti, an accountant at RubinBrown LLP who reviewed the returns.
Responding to a request for comment from WSJ, Biden’s campaign said the Bidens paid taxes at a rate that exceeded 33% and are “committed” to the idea that all Americans should pay their fair share.
The technique of using an S-Corp to shield earnings from a self-employment tax, is known in tax circles as the Gingrich-Edwards loophole, for former presidential candidates Newt Gingrich, a Republican, and John Edwards, a Democrat. Both men were scrutinized for using the loophole years ago, and since then, there has been talk of closing it.
But go on – tell us again how President Trump is a tax cheat and a failed businessman?