At least 18 billionaires and hundreds of other wealthy individuals received federal stimulus checks. even though the payments were aimed at helping poor and middle class income households weather the pandemic’s economic crisis according to a new report.
About 270 wealthy people received payments in the first round of stimulus checks directed by lawmakers in 2020 under the American CARES Act. Despite having a total of $5.7 billion in income, according to the report, which cited a large amount of IRS data on thousands of the nation’s wealthiest individuals.
These rich taxpayers received stimulus checks after tapping complex tax deductions to reduce their net incomes to less than zero. With these wealthy Americans doing this it made them qualify for the checks the report noted. Under the CARES Act law the full payments of $1,200 per single taxpayer and $2,400 for married couples were only available to single people earning less than $75,000 or couples with incomes below $150,000.
Included among the billionaires who received stimulus checks are philanthropist George Soros. Soros net worth $7.5 billion. Another billionaire financier Ira Rennert worth $3.7 billion the report noted.
A representative for Soros said he received a check from the United States government as part of the CARES Act. “He did not request the funds or take any other action to obtain them. He promptly returned the check,” the representative said in a memo to the press.
Experts say indeed it may seem mind boggling that a billionaire could qualify for a $1,200 check from a stimulus program with an income threshold of $75,000 per single taxpayer. Financial experts say this is because these billionaires tapped write-offs, deductions and other loopholes to minimize their incomes. When billionaires do this it appears to the IRS to have net incomes of less than zero, making them eligible for the payments.
The report comes as some Democratic lawmakers are pushing for a tax on billionaires. Democrats are arguing that the nation’s wealthiest citizens should pay more as a matter of fairness. During the pandemic, the collective net worth of America’s richest rose because of the high price of the stock market during the heat of the pandemic.
Most people pay taxes on earned income, such as their salaries or earnings from gig work, which is reported to the IRS on W2 or 1099 statements. The wealthy however have a host of accounting tricks and deductions they can use to reduce their reported income. Experts say the wealthy can do this by using business losses to offset income. Those valuable deductions can effectively minimize their tax liabilities.
