Warren Buffett made $62,855,038 last year… Company still owes as much as $1B in back taxes
NEW YORK (CNNMoney) — Billionaire investor Warren Buffett this week showed a little more leg in his campaign to get Congress to raise taxes on the uber-rich.
In a letter to Republican Rep. Tim Huelskamp Tuesday, Buffett revealed that his adjusted gross income last year was $62,855,038 and that his taxable income was $39,814,784. Buffett said he paid $15,300 in payroll taxes.
Buffett also said his federal income tax bill came to $6,923,494, or 17.4% of his taxable income — two points he revealed in a New York Times op-ed in August urging Congress to tax the wealthy more.
Buffett provided a copy of his correspondence with Huelskamp to CNNMoney’s Poppy Harlow.
He said in an interview that the roughly $23 million difference between his AGI and taxable income was due largely to deductions he took for charitable giving and local taxes.
Two key reasons he only paid 17.4%, however, is because a lot of his income came from investments, which are taxed at a lower rate than wages, and because payroll taxes are assessed only on the first $106,800 of wages.
“People who make money with money are getting taxed at a far lower rate than people who make money by their own labor,” Buffett told CNNMoney.
Warren Buffett, President Obama’s pet billionaire, spends a great deal of time calling for tax increases on wealthy people. He began a recent New York Times op-ed, entitled “Stop Coddling the Super-Rich,” as follows:
OUR leaders have asked for “shared sacrifice.” But when they did the asking, they spared me. I checked with my mega-rich friends to learn what pain they were expecting. They, too, were left untouched.
While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks. Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15 percent tax rate. Others own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors.
These and other blessings are showered upon us by legislators in Washington who feel compelled to protect us, much as if we were spotted owls or some other endangered species. It’s nice to have friends in high places.
That’s right, serfs: anything your benevolent “leaders” in Washington allow you to keep is a “blessing” that has been “showered” upon you. All money rightfully belongs to the State. It’s about time you spotted owls got with the program.
Funny thing is, it turns out Buffett was being… shall we say… disingenuous when he claimed his “leaders” never got around to asking for his “shared sacrifice.” His company, Berkshire Hathaway, has been fighting the IRS tooth and nail to avoid paying its federal tax bill for nearly a decade.
How much of the State’s rightful money has this hypocrite been clutching in a white-knuckled death grip? Oh, only about a billion dollars or so. Bill Wilson of Americans for Limited Government tallies up the bill:
Using only publicly-available documents, a certified public accountant (CPA) detailed Berkshire Hathaway’s tax problems to ALG researcher Richard McCarty. Now, the American people have a better idea of how much in back taxes the company could owe Uncle Sam.
According to page 56 of the company report, “At December 31, 2010… net unrecognized tax benefits were $1,005 million”, or about $1 billion. McCarty explained, “Unrecognized tax benefits represent the company’s potential future obligation to the IRS and other taxing authorities. They have to be recorded in the company’s financial statements.”
He added, “The notation means that Berkshire Hathaway’s own auditors have probably said that $1 billion is more likely than not owed to the government.”