It appears that Sen. Bob Corker (R-TN) managed to pull off a heist from himself and President Trump after Republicans put a last-minute provision into the final tax bill in order to win his vote.
A new analysis of federal data has revealed that Republicans tailored the bill in a way that significantly boosted the amount of potential tax cuts that could be reaped by real estate investors. That tweak would deliver huge benefits to a relatively small set of real estate moguls — such as President Donald Trump and Sen. Bob Corker, , according to the Internationa Business Times.
Corker voted against the Senate version of the bill, which included restrictions on such tax breaks for real estate pass-throughs (including LLCS, partnerships and S-corporations) but then switched his position after the provision was added to the final bill.
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“Facing outrage over the flip-flop — including a trending #CorkerKickback hashtag — Republican Ways and Means Committee Chairman Kevin Brady insisted that the provision was not designed to be a payoff to Corker and other real estate moguls, but instead a way “to encourage businesses, pass-through businesses that do a lot of capital investment for growth — energy, advanced manufacturing, telecom.”
Yet an analysis of the most recent IRS data by Brookings-Urban Institute Tax Policy Center researcher Joe Rosenberg challenges that narrative. The data shows the provision’s benefits to real estate partnerships dwarfs the benefits it provides to other partnerships across the economy. The analysis also shows that the provision could potentially end up providing, on average, up to 10 times the amount of tax benefits to the real estate sector as the original Senate-passed bill.
“You can see who the specific winner is from this proposal — it’s startling, because real estate just totally sticks out,” Brookings-Urban Institute Tax Policy Center fellow Steve Rosenthal told International Business Times. “It shows that when you change the formula in the way the final bill changed the formula, the clear winner beyond any other industry is the real estate sector.”
Forbes on Tuesday estimated President Trump could save $11 million a year in taxes under the final bill. Economist Dean Baker has estimated that Corker could reduce his tax burden by as much as $1.1 million per year from the new provision alone.
Corker, who has clashed with Trump, has been in the spotlight because he changed his position on the tax legislation. On December 2, he was the only Republican to vote against the Senate bill when it included language effectively restricting how much of a personal benefit he could glean from the pass-through tax cuts. But then he announced his support for the final bill Friday, just hours before the release of the final bill that included the provision boosting the tax cuts to real estate investors like him.