Thursday, 2 October 2014
Last updated 1 hour ago
Aug 11 2010 | 10:14am ET
Omega Advisors founder Leon Cooperman said he was “mortified” when he received a $19 million tax bill that he claims was the result of bad tax advice.
Cooperman, who seeded hedge fund Jana Partners in exchange for a share of its fee income, turned over that stake to his charity, the Leon and Toby Cooperman Family Foundation, in 2001 and 2006. Each time, he had the future income streams professionally appraised, the first half at $15 million and the second at $28 million.
The only problem, as Cooperman concedes, is that you’re not allowed to deduct non-publicly-traded securities donated to your own foundation. He likely would not know that—and would not be on the hook for almost $20 million—if he hadn’t had his first Jana appraisal redone in 2006, after the second appraisal found the other half of the stake to be worth nearly twice as much.
Armed with a new $20 million appraisal from RSM Business Services, Cooperman filed an amended tax return in 2005. In return, he got the tax bill—for $15 million in unpaid taxes and $4 million in fines.
While Cooperman is formally disputing the whole of the bill, his lawyer told Forbes he’s hoping that the penalties will be waived. Richard Levine notes that Cooperman relied on tax professionals and should not be penalized for their mistakes.
Whether Cooperman’s tax preparer, Gittelman & Co., or RSM will be penalized remains to be seen. The billionaire will wait until the tax case runs its course before considering his legal options against them.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Sep 30 2014 | 9:29am ET
The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…
High frequency trading is not evil, it is not a conspiracy and it really is not new; it is the natural evolution of the professional trading community making markets, providing liquidity and hopefully...