Hedge mogul beats DC in slick $64M tax schemeBy KAJA WHITEHOUSE
Billionaire hedge fund mogul Eddie Lampert has outsmarted lawmakers and come up with a way around a planned tax hike on earnings for hedge funds and private equity firms -- saving himself about $64 million.
The 47-year old financial whiz side-stepped the likely higher tax bill by having his Greenwich, Conn., hedge fund firm, ESL Partners, distribute roughly $837 million in stock to him personally last week -- a move that will allow him to pay the lower capital gains tax rate compared to the higher regular income tax rate had the fund distributed cash.....
...Street insiders expect a parade of financial titans to follow Lampert's lead, which could throw a wrench in lawmakers' plans to plug the deficit with additional tax revenue.
At one point, lawmakers predicted the higher tax rate on hedge funds and private equity firms could translate into $17.7 billion in added revenue over 11 years....
....At a 25 percent tax rate, Lampert would fork over $111.2 million of that to Uncle Sam. At 15 percent, the bill is $66.7 million. There are comparable savings for the Sears and AutoNation stakes.....
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