Billionaire John Paulson Paid Zero Taxes For 9 Billion Fee Income

April 14, 2011 1:23 pm

We spotted this today: “John Paulson, the most successful hedge-fund manager of all, bet against the mortgage market one year and then bet with Glenn Beck in the gold market the next. Paulson made himself $9 billion in fees in just two years. His current tax bill on that $9 billion? Zero.”

This is the trick: “So long as they leave their money, known as “carried interest,” in the hedge fund, their taxes are deferred. They only pay taxes when they cash out, which could be decades from now for younger managers. How do these hedge-fund managers get money in the meantime? By borrowing against the carried interest, often at absurdly low rates—currently about 2 percent.”

Statistics Source: wweek

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1 Comment for “Billionaire John Paulson Paid Zero Taxes For 9 Billion Fee Income”

  1. […] had spotted a stat some time back on billionaire hedge fund manager John Paulson’s taxes – how he paid zero taxes on billions of dollars of income. We spotted this […]

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