Thursday, 30 June 2016
Last updated 5 min ago
Jun 18 2014 | 8:33am ET
Sen. Ron Wyden isn’t happy that hedge funds are using insurance companies to avoid U.S. taxes—and he wants to know why something isn’t being done about it.
The Oregon Democrat last week asked the U.S. Treasury Department and Internal Revenue Service why steps were not being taken to close the loophole that permits the tax-avoidance strategy, one that has been employed by Paulson & Co., among others. By channeling investments through offshore insurance companies, hedge fund managers are able to pay capital-gains taxes, rather than the much higher ordinary income tax.
The IRS has been looking at the matter since 2003. Wyden asked why, after more than a decade, it has “made no progress in ending this kind of tax abuse.”
“I am keenly interested in exploring opportunities to work together to solve this serious issue,” Wyden said.