Have you received the trump tax cut yet?
In the months after President Donald Trump signed
the Tax Cuts and Jobs Act in December 2017, some tax professionals grew giddy
as they discovered opportunities for their clients inside a law that already
slashed rates for corporations and wealthy individuals.
The revelations about the wage maneuvers come from
a trove of IRS records obtained by ProPublica covering thousands of the
wealthiest Americans. Previous articles in “The Secret IRS
Files” series have detailed how the wealthy avoid paying taxes legally,
including a story last week exploring the massive
benefits the Trump tax overhaul provided billionaires.
The wages for car accessory
manufacturer David MacNeil, whose WeatherTech floor mats are featured in a
Super Bowl ad each year, fell from $68 million in 2017 to $47 million in 2018.
The salary of Jeffrey Records, CEO of
Oklahoma City-based MidFirst Bank, plummeted from $8.6 million to $1.8 million.
And the wages of Dick Uihlein, the
Republican megadonor and chairman of shipping supplies behemoth Uline, sank
from $5.1 million to $2.1 million.
It’s impossible to say how much money
was reclassified as a result of the new law, but consider this: The loophole
already existed, in much smaller form, before the Trump tax overhaul. A
government report in 2009 estimated the U.S. Treasury was losing
billions to this strategy. Back then, an owner could save the Medicare tax by
counting a dollar as profits rather than salary. But after the Trump law, the
tax savings roughly tripled, to about 11%.
