Jared Kushner has acquired real estate worth billions of dollars in the previous years and as a result, his net worth has risen to $324 million.
But this was at the cost of no federal income taxes. Mr Kushner, who is the son-in-law of President Trump and also a senior adviser in the White House, has not paid any federal income tax all these years. This was revealed when some confidential financial documents were reviewed.
Mr Kushner was able evade taxes by tax-minimizing manoeuvre. The losses shown were only on paper and Mr Kushner and his company didn’t suffer from any losses in real. Depreciation was one reason behind it as it lets the real estate investors to deduct building cost from the taxable income each year.
The confidential documents reveal that in 2015, Mr Kushner got a salary of $1.7 million and investment gains. But losses of $8.3 million swamped these earnings majorly due to significant depreciation. The documents reveal nothing that could be questionable by law.
According to the depreciation theory, it acts as a shield for real estate developers to protect their investments from whittling away due to wear and tear of the buildings that they invested in. however, in practice, allowance often acts as a lucrative giveaway to the investors like Mr Kushner and Mr Trump.
As per the law, buildings are said to lose value each year due to depreciation. However, in reality, the buildings gain value. The flexibility provided allows the real estate investors to determine their tax burdens. The revision of tax laws have further allowed the real estate investors to make larger deductions.
The Trump administration was in a position to clean up the tax code and promised to get rid of some of the complexity that certain taxpayers use to their advantage. Instead, they doubled down on those provisions, particularly the ones they have familiarity with to benefit themselves.
Source: nytimes, democraticunderground
