While recently touting his infrastructure plan, President Biden griped “the wealthiest 1% of Americans saw their net worth increase by $4 trillion,” he then ripped loopholes and deductions corporations used to dodge taxes.
But a blistering letter from the leader of a House conservative caucus regarding Biden’s own tax loopholes could foreshadow what Republicans will include in their oversight agenda should they flip the House of Representative in 2022.
“House Democrats used their oversight power to subpoena Trump for his tax returns, but they’ve completely ignored Joe Biden’s abuse of our tax code,” Republican Study Committee Chairman Rep. Jim Banks, R-Ind., told Fox News. “When we take back the House in 2022, Oversight [Committee] Republicans won’t forget about Biden’s legally dubious tax avoidance schemes.”
As a private citizen in 2017, 2018 and 2019, Biden and first lady Jill Biden routed $13 million in income through two S-corporations – CelticCapri Corporation and the Giacoppa Corporation – to avoid paying taxes that help fund Medicare and the Affordable Care Act (ACA), better known as ObamaCare. While entirely legal, Biden has advocated eliminating such loopholes, while also promoting the expansion of both Medicare and ObamaCare.
The Banks letter to Biden asked, “Do you intend to undo your hypocrisy and pay these taxes back to the American people?”
“Press reports indicate that you both directed revenue from book royalties and speaking appearance fees into these two corporations avoiding self-employment payroll tax liabilities that would have flowed to America’s Medicare program that provides care to over 60 million seniors,” reads the letter, dated March 25.
In the minority, congressional Republicans – many of whom have called for oversight of Biden’s handling of the border crisis or of potential conflicts of interest regarding his son Hunter Biden’s overseas business – lack the authority to compel Biden or his administration to provide information on any matter. But, as Americans witnessed during the previous administration, the issues Democrats continuously talked about in 2017 and 2018 – including President Trump’s taxes – became fodder for investigative hearings after Democrats held a House majority beginning in 2019.
The Biden tax savings demonstrate “Democrat hypocrisy is limitless,” Banks said, contrasting this with both the president’s public policies and the working-class image Biden cultivated throughout his political career.
“The ACA imposed higher taxes on millions of Americans, but not Joe Biden. He paid $121,000 less in ObamaCare taxes thanks to an obscure tax loophole. Talk about inside baseball,” Banks told Fox News. “Joe Biden advocated for expanding Medicare, and is pushing to close tax loopholes and for a $3 trillion tax hike. At the same time, ‘Amtrak Joe’ made $13 million through speaking fees in just three years, then skimped over $500,000 from Medicare recipients through tax loopholes.”
The Wall Street Journal first reported the first couple’s tax move in July that saved them as much as $500,000. The newspaper said the Bidens avoided paying 3.8% in Medicare payroll taxes by moving book royalties and speaking-related income into an S-corporation.
An S-corporation, under IRS rules, is a partnership with fewer than 100 shareholders. The company may pass income directly to shareholders to avoid double taxation.
Combined, CelticCapri Corp. and Giacoppa Corp. reported profits of more than $13 million for 2017 and 2018, the Journal reported, not subject to self-employment taxes. The companies paid the Bidens less than $800,000 in salaries.
“Your hypocrisy is highlighted by the fact that Medicare faces significant funding shortfalls,” the Banks letter from last week says. “Just this year, the Congressional Budget Office estimated its Hospital Insurance Trust Fund will face insolvency in the middle of Fiscal Year 2026—roughly five years from now.”
“Moreover, during the presidential campaign, you said ‘ObamaCare is personal to me,’” the letter adds. “And your administration has sought to expand ObamaCare wherever possible. Yet, you and your wife avoided paying $121,000 in Obamacare payroll taxes.”
The White House did not respond to an inquiry from Fox News on this matter. But in July, the Biden campaign told the Journal, “As demonstrated by their effective federal tax rate in 2017 and 2018—which exceeded 33 percent—the Bidens are committed to ensuring that all Americans pay their fair share.”
Notably, this information came to light because the Bidens released their tax returns, which Trump never did — prompting Democratic investigations.
Biden has a history of calling for high-income Americans to pay more in taxes.
When running for vice president on a Democratic ticket with Barack Obama in 2008, Biden told CBS News’ Kate Snow in an interview that those earning more than $250,000 should “pay more,” adding “It’s time to be patriotic, Kate, time to jump in, time to be part of the deal, time to help get America out of the rut.”
During his 2020 Democratic National Convention acceptance speech in August, Biden called for “ending loopholes” for the wealthy.
“Because we don’t need a tax code that rewards wealth more than it rewards work. I’m not looking to punish anyone,” Biden said in the acceptance speech. “Far from it. But it’s long past time the wealthiest people and the biggest corporations in this country paid their fair share.”