Why is Bank of America Not Paying Any Taxes on $4.4 Billion in Income?

Posted on 07 April 2010
By Sara Flocks
California Labor Federation

Around this time every year, Californians scramble to finish doing their taxes and pay what they owe to the government.

But not everyone is paying their fair share. Forbes Magazine recently analyzed the tax returns of the top 25 U.S. companies and found out that they’re not paying much in taxes. In fact, corporations such as Bank of America, General Electric and Citigroup will not be paying ANY taxes this year --- they’re actually getting money back from the government. Forbes explains:

How did Bank of America not pay any taxes on $4.4 billion in income? Because of deductions like $860 million in tax-exempt income, $670 million in low-income housing credits and a $600 million loss on shares of foreign subsidiaries. With a provision for credit losses of $49 billion, Bank of America probably won't be paying taxes for a long time.

After taxpayers bailed out Bank of America to the tune of $45 billion and helped boost their income to $4.4 billion, Bank of America is using every possible tax loophole to get out of paying their fair share.

Bank of America isn’t alone in using tax loopholes, shelters and other shell games to get out of paying taxes. A study by the U.S. Government Accountability Office found that two out of every three U.S. corporations paid no federal income taxes from 1998 through 2005.

In California, state legislators and Governor Schwarzenegger have made it even easier for corporations to use state resources, yet not pay a penny for them. Every year, California gives away $14.5 billion in tax breaks to corporations. Since 2007, Governor Schwarzenegger has signed into law numerous corporate tax breaks, exemptions and credits that will cost the state an estimated $3 billion a year.

Three tax breaks, passed as part of the 2008 and 2009 budget deal, will benefit a very small number of extremely wealthy corporations. According to Jean Ross at the California Budget Project:

Nine corporations will receive tax cuts averaging $33.1 million each in 2013-14 due to the adoption of elective single sales factor apportionment. Eighty percent of the benefits of single sales factor apportionment will go to the 0.1 percent of California corporations with gross incomes over $1 billion.

Under existing law, it is nearly impossible to track how much of California’s budget is lost to corporate tax subsidies, what companies are getting the subsidies, and if those subsidies are creating jobs. Many of these tax expenditures are permanent and never reviewed. Companies are permitted to take taxpayer money and run – relocating jobs in other states or countries.

And guess who has to make up what corporations squirm out of paying? You, me and every other working person out there. When corporations don’t pay their fair share, the burden of funding schools, public safety, parks, libraries and infrastructure like roads and bridges falls on the rest of us.

California is facing a $20 billion budget shortfall. The state has cut every vital social service to the bone, and we’re facing more cuts to our schools, police, firefighters, medical clinics, roads and other services we depend on every day. Even though we are paying our fair share in taxes, middle class families are getting less in return and are bearing the brunt of the state’s drastic budget cuts.

$14.5 billion a year could go pretty far in filling the budget hole, if we got rid of corporate tax loopholes. The California Labor Federation is sponsoring a package of four bills to increase transparency and accountability of public spending on corporate tax expenditures. They are:

AB 2564 (Swanson) – Corporate tax breaks are not included in the budget, making it difficult to track their true cost. This bill requires that an analysis of all tax expenditures show up in the budget so that legislators can review tax expenditures and budget allocations at the same time.

SB 1391(Yee) – Companies that receive tax subsidies and fail to meet the intended purpose and goals required by the Legislature should pay the state back the tax subsidies received. This bill allows the state to recapture, or “clawback,” tax breaks given to a business to create jobs if that company decreases employment in California.

SB 1272 (Wolk) – Tax expenditures should be regularly reviewed for their effectiveness. This bill requires every new tax subsidy to state public policy goals and measures of effectiveness, and each subsidy will sunset after 5 years.

AB 2666 (Skinner) – This bill will create a publicly accessible database that would display the names of all applicants for economic development subsidies, their stated intended purposes, the number of jobs created, their wage rates and benefits. Illinois has adopted such database, providing more information to policymakers and the public to assist in holding recipients of tax expenditures accountable to taxpayer goals.

http://www.californiaprogressreport.com/site/print/7639

How Dumb Are We?

Andrew Romano Andrew Romano – Sun Mar 20, 10:45 pm ET

NEW YORK – NEWSWEEK gave 1,000 Americans the U.S. Citizenship Test—38 percent failed. The country's future is imperiled by our ignorance. In this week’s issue, Andrew Romano looks at the risks involved in America’s ignorance.

They’re the sort of scores that drive high-school history teachers to drink. When NEWSWEEK recently asked 1,000 U.S. citizens to take America’s official citizenship test, 29 percent couldn’t name the vice president. Seventy-three percent couldn’t correctly say why we fought the Cold War. Forty-four percent were unable to define the Bill of Rights. And 6 percent couldn’t even circle Independence Day on a calendar.

Don’t get us wrong: civic ignorance is nothing new. For as long as they’ve existed, Americans have been misunderstanding checks and balances and misidentifying their senators. And they’ve been lamenting the philistinism of their peers ever since pollsters started publishing these dispiriting surveys back in Harry Truman’s day. (He was a president, by the way.) According to a study by Michael X. Delli Carpini, dean of the Annenberg School for Communication, the yearly shifts in civic knowledge since World War II have averaged out to “slightly under 1 percent.”

But the world has changed. And unfortunately, it’s becoming more and more inhospitable to incurious know-nothings—like us.

To appreciate the risks involved, it’s important to understand where American ignorance comes from. In March 2009, the European Journal of Communication asked citizens of Britain, Denmark, Finland, and the U.S. to answer questions on international affairs. The Europeans clobbered us. Sixty-eight percent of Danes, 75 percent of Brits, and 76 percent of Finns could, for example, identify the Taliban, but only 58 percent of Americans managed to do the same—even though we’ve led the charge in Afghanistan. It was only the latest in a series of polls that have shown us lagging behind our First World peers.

Most experts agree that the relative complexity of the U.S. political system makes it hard for Americans to keep up. In many European countries, parliaments have proportional representation, and the majority party rules without having to “share power with a lot of subnational governments,” notes Yale political scientist Jacob Hacker, coauthor of Winner-Take-All Politics. In contrast, we’re saddled with a nonproportional Senate; a tangle of state, local, and federal bureaucracies; and near-constant elections for every imaginable office (judge, sheriff, school-board member, and so on). “Nobody is competent to understand it all, which you realize every time you vote,” says Michael Schudson, author of The Good Citizen. “You know you’re going to come up short, and that discourages you from learning more.”

For more than two centuries, Americans have gotten away with not knowing much about the world around them. But times have changed—and they’ve changed in ways that make civic ignorance a big problem going forward.

It doesn’t help that the United States has one of the highest levels of income inequality in the developed world, with the top 400 households raking in more money than the bottom 60 percent combined. As Dalton Conley, an NYU sociologist, explains, “it’s like comparing apples and oranges. Unlike Denmark, we have a lot of very poor people without access to good education, and a huge immigrant population that doesn’t even speak English.” When surveys focus on well-off, native-born respondents, the U.S. actually holds its own against Europe.

Other factors exacerbate the situation. A big one, Hacker argues, is the decentralized U.S. education system, which is run mostly by individual states: “When you have more centrally managed curricula, you have more common knowledge and a stronger civic culture.” Another hitch is our reliance on market-driven programming rather than public broadcasting, which, according to the EJC study, “devotes more attention to public affairs and international news, and fosters greater knowledge in these areas.”

For more than two centuries, Americans have gotten away with not knowing much about the world around them. But times have changed—and they’ve changed in ways that make civic ignorance a big problem going forward. While isolationism is fine in an isolated society, we can no longer afford to mind our own business. What happens in China and India (or at a Japanese nuclear plant) affects the autoworker in Detroit; what happens in the statehouse and the White House affects the competition in China and India. Before the Internet, brawn was enough; now the information economy demands brains instead. And where we once relied on political institutions (like organized labor) to school the middle classes and give them leverage, we now have nothing. “The issue isn’t that people in the past knew a lot more and know less now,” says Hacker. “It’s that their ignorance was counterbalanced by denser political organizations.” The result is a society in which wired activists at either end of the spectrum dominate the debate—and lead politicians astray at precisely the wrong moment.

The current conflict over government spending illustrates the new dangers of ignorance. Every economist knows how to deal with the debt: cost-saving reforms to big-ticket entitlement programs; cuts to our bloated defense budget; and (if growth remains slow) tax reforms designed to refill our depleted revenue coffers. But poll after poll shows that voters have no clue what the budget actually looks like. A 2010 World Public Opinion survey found that Americans want to tackle deficits by cutting foreign aid from what they believe is the current level (27 percent of the budget) to a more prudent 13 percent. The real number is under 1 percent. A Jan. 25 CNN poll, meanwhile, discovered that even though 71 percent of voters want smaller government, vast majorities oppose cuts to Medicare (81 percent), Social Security (78 percent), and Medicaid (70 percent). Instead, they prefer to slash waste—a category that, in their fantasy world, seems to include 50 percent of spending, according to a 2009 Gallup poll.

Needless to say, it’s impossible to balance the budget by listening to these people. But politicians pander to them anyway, and even encourage their misapprehensions. As a result, we’re now arguing over short-term spending cuts that would cost up to 700,000 government jobs, imperiling the shaky recovery and impairing our ability to compete globally, while doing nothing to tackle the long-term fiscal challenges that threaten … our ability to compete globally.

Given our history, it’s hard to imagine this changing any time soon. But that isn’t to say a change wouldn’t help. For years, Stanford communications professor James Fishkin has been conducting experiments in deliberative democracy. The premise is simple: poll citizens on a major issue, blind; then see how their opinions evolve when they’re forced to confront the facts. What Fishkin has found is that while people start out with deep value disagreements over, say, government spending, they tend to agree on rational policy responses once they learn the ins and outs of the budget. “The problem is ignorance, not stupidity,” Hacker says. “We suffer from a lack of information rather than a lack of ability.” Whether that’s a treatable affliction or a terminal illness remains to be seen. But now’s the time to start searching for a cure.

Andrew Romano is a Senior Writer for Newsweek. He reports on politics, culture, and food for the print and web editions of the magazine and appears frequently on CNN and MSNBC. His 2008 campaign blog, Stumper, won MINOnline's Best Consumer Blog award and was cited as one of the cycle's best news blogs by both Editor & Publisher and the Deadline Club of New York. Follow Andrew on Twitter.

http://news.yahoo.com/s/dailybeast/13043_americasignorancecouldposehugeproblems;_ylt=ArJsqSsCQmtsBOvMCE6XIaOs0NUE;_ylu=X3oDMTRvOG5wNGczBGFzc2V0A2RhaWx5YmVhc3QvMjAxMTAzMjEvMTMwNDNfYW1lcmljYXNpZ25vcmFuY2Vjb3VsZHBvc2VodWdlcHJvYmxlbXMEY2NvZGUDbW9zdHBvcHVsYXIEY3BvcwM4BHBvcwM1BHB0A2hvbWVfY29rZQRzZWMDeW5faGVhZGxpbmVfbGlzdARzbGsDaG93ZHVtYmFyZXdl

CHART: Taxing Millionaires Would Save Billions More Than Cutting Education And Programs For Main Street

All around the country, right-wing legislators are asking Main Street Americans to pay for budget deficits caused mainly by a recession caused by Wall Street by attacking collective bargaining, and cutting necessary services and investments like college tuition aid and health care for the poor.

As these conservatives are cutting these services for hard-working middle class Americans, they are claiming they are acting out of need for “shared sacrifice.” Yet at the same time, the right continues to advocate for massive tax cuts for the wealthiest among us.

Rep. Jan Schakowksy (D-IL), along with a number of her progressive congressional colleagues, has introduced a plan that demands real “shared sacrifice.” Her plan, The Fairness in Taxation Act, calls for creating new tax brackets for the richest Americans, starting at a 45 percent rate for people whose income is $1 million. Her bracket would impose the highest rate — 49 percent — on billionaires.

A chart provided by her congressional office demonstrates that asking the wealthiest among us to pay a little more would actually save more money than all of the House Republicans’ cuts to domestic spending combined. House Resolution 1, which gutted funding on Pell Grants, low-income housing aid, community health centers, and other important programs for Main Street Americans, cut a total of $61 billion. Meanwhile, Schakowsky’s plan saves $78.9 billion, considerably more:

In an interview with ThinkProgress, Schakowsky said that she is “hoping” to build enough momentum within Congress to make her proposal the main alternative to the conservative slash-and-burn budget effort, saying that it is a “winner” for Democrats, both politically and on policy grounds. She said that the House Progressive Caucus is planning to do a road show in the summer to campaign on tax justice and endorsed the Main Street Movement that is defending the middle class across America:

THINKPROGRESS: You’ve mentioned a few times the grassroots movement that’s going on…that’s something that we here at ThinkProgress have dubbed the Main Street Movement, all around this country we’re seeing working families rise up. [...] I wonder if you’ve and your colleagues on the Progressive Caucus have thought about similar kinds of tactics [to the Tea Party], a road show, holding rallies, trying to engender grassroots momentum around your proposals.

SCHAKOWSKY: Well, the Progressive Caucus is planning a road show this summer. This will be a central theme of that. [...] But I think this needs to be bigger than that. [...] I like the idea of branding, I like the idea of the Main Street Movement, and I think it is beginning to seriously come together. I think all of the pieces are out there to put this together right now. This is a moment. I want to capture it right now by introducing this legislation that clearly states an alternative that is very popular.

Listen to it:

Indeed, taxing the super-wealthy is quite popular. A March 2 NBC News/Wall Street Journal poll found that 81 percent of Americans prefer taxing the wealthiest Americans more as their top choice for deficit reduction, while less than a third of Americans endorsed policy options like cutting funding to education and health care.

http://thinkprogress.org/2011/03/21/taxing-rich-save-billions/

Kochs Fund $5.6 Million Ad Campaign in Ohio

Submitted by Anne Landman on March 21, 2011 - 12:40pm

Billionaires Charles and David Koch of Koch Industries are funneling $5.6 million through the astroturf group FreedomWorks for an Ohio TV ad campaign starting March 18, 2011 that continues the attack on labor unions that Wisconsin Governor Scott Walker started in February. FreedomWorks, a non-profit group heavily involved with organizing the Tea Party, does not disclose its corporate donors. The 30-second TV ad focuses on Ohio, but features discredited Fox News footage taken of an out-of-state protest, inserted in the ad order to depict Wisconsin union protesters as being aggressive. The ad blames unions for what it claims is a debt "crisis" in Ohio. It says, "We won in Wisconsin, but the fight must go on," and urges viewers to call a phone number to "Thank Governor Kasich for leading the fight against Union corruption in Ohio."The ad doesn't mention that a Wisconsin judge temporarily blocked implementation of Governor Walker's anti-union bill over a potential violation of open meetings laws incurred in the way the highly-contentious bill was pushed through Wisconsin's legislature.

Main Source: The Cleveland Leader, March 18, 2011

http://www.prwatch.org/spin/2011/03/10373/kochs-fund-56-million-ad-campaign-ohio

Costs of Libya Operation Already Piling Up

By Megan Scully
Monday, March 21, 2011 | 2:17 p.m.

With U.N. coalition forces bombarding Libyan leader Muammar el-Qaddafi from the sea and air, the United States’ part in the operation could ultimately hit several billion dollars -- and require the Pentagon to request emergency funding from Congress to pay for it.

The first day of Operation Odyssey Dawn had a price tag that was well over $100 million for the U.S. in missiles alone. And the U.S. military, which remains in the lead now in its third day, has pumped millions more into air- and sea-launched strikes targeting air-defense sites and ground-force positions along Libya’s coastline.

The ultimate total that the United States spends will hinge on the length and scope of the strikes as well as on the contributions of its coalition allies. But Todd Harrison, a senior fellow at the Center for Strategic and Budgetary Assessments, said on Monday that the U.S. costs could “easily pass the $1 billion mark on this operation, regardless of how well things go.”

The Pentagon has the money in its budget to cover unexpected contingencies and can also use fourth-quarter dollars to cover the costs of operations now. “They’re very used to doing this operation where they borrow from Peter to pay Paul,” said Gordon Adams, who served as the Office of Management and Budget’s associate director for national security during the Clinton administration.

However, there comes a point when there simply isn’t enough cash to pay for everything. The White House has not yet indicated whether it will request emergency funding, but former Pentagon comptroller Dov Zakheim estimated that the Defense Department would need to send a request for supplemental funding to Capitol Hill if the U.S. military’s share of Libya operations expenses tops $1 billion.

Such a request would likely be met with mixed reactions in a Congress focused on deficit reduction. And while many key lawmakers have been agitating for action in Libya, others have been more reluctant and have urged the Obama administration to send them a declaration of war.

Senate Foreign Relations ranking member Richard Lugar, R-Ind., says Congress should have had the opportunity to weigh in on what he said will be “a very expensive operation, even in a limited way.”

Speaking on CBS’s Face the Nation on Sunday, Lugar said, “It’s a strange time in which almost all of our congressional days are spent talking about budget deficits, outrageous problems. And yet [at the] same time, all of this passes.”

So far, the operation appears to be focused on creating a limited no-fly zone mostly targeting the capital city of Tripoli, which is Qaddafi’s stronghold, and other areas along the coast. That will require a wide range of military assets.

In a report released earlier this month, Harrison estimated that the initial stages of taking out Qaddafi’s coastal air defenses could ultimately cost coalition forces between $400 million and $800 million. But the coalition is now targeting his ground forces in an effort to protect civilians—a factor that Harrison said will drive up the initial costs of the operation.

“At some point, though, we will have degraded his forces to the point that there are not that many targets left,” Harrison said. “So we’d expect to see the sortie rate start to drop off.”

Meanwhile, Harrison initially estimated that maintaining a coastal no-fly zone after those initial strikes would cost in the range of $30 million to $100 million per week. If the coalition continues to strike ground targets, the weekly costs would be closer to the higher range, he said.

These unanticipated costs come at a time when the Pentagon is putting pressure on Capitol Hill to pass its fiscal 2011 budget. Continuing to operate under a stopgap continuing resolution through September, senior Defense officials argue, would amount to a $23 billion cut to the military’s request for the current fiscal year, which began October 1. The Pentagon wants $708.3 billion for this year, including $159.3 billion for the wars in Iraq and Afghanistan.

For the U.S. military, the highest costs of the operations over Libya come in the form of pricey munitions, fuel for aircraft, and combat pay for deployed troops -- all factors that will pile up each day U.S. forces remain at the helm of the operation.

On the first day of strikes alone, U.S.-led forces launched 112 long-range Tomahawk cruise missiles, which cost about $1 million to $1.5 million apiece, from ships stationed off the Libyan coast. That totaled $112 million to $168 million. Since those first strikes, U.S. and British forces have launched at least another 12 Tomahawk missiles.

The Defense Department typically buys about 200 Tomahawks a year. While the military likely can put off buying new missiles for months, it will ultimately need to boost planned procurement rates to refill its stockpile.

Defense budget watchers said the deployment of guided missile destroyers and submarines would not put a major dent in the Pentagon’s accounts because the ships were already deployed to the region. But the U.S. military has tapped its B-2 bombers as well as F-15 and F-16 fighter jets to strike a number of targets, undoubtedly forcing an immediate uptick in the military’s operations and maintenance expenditures, including fuel costs.

The military flew the three bombers deployed for the mission from Missouri’s Whiteman Air Force Base, a nearly 12,000-mile round trip that will incur significant fuel and maintenance costs for the aircraft, Harrison said. Meanwhile, it generally costs $10,000 per hour, including maintenance and fuel, to operate F-15s and F-16s.

Those costs do not include the payloads dropped from the aircraft. The B-2s dropped 45 Joint Direct Attack Munitions, or JDAMS, which are 2,000-pound bombs that cost between $30,000 and $40,000 apiece to replace.

On the personnel front, special pay for soldiers involved in the operation will kick in immediately – unlike the munitions costs, which the Pentagon can defer.

Ultimately, the length and scale of the operation will be key to its total costs to the United States. A weeklong operation involving a limited number of U.S. troops would be manageable within the existing budget. But if the operation drags into weeks and months, the Pentagon would likely have to do some maneuvering to replenish its accounts.

The United States, meanwhile, continues to lead operations, although U.S. military leaders insist that control will soon be transferred to a coalition leader that has yet to be identified.

Army Gen. Carter Ham, the operational commander, told reporters on Monday that allies are stepping up to shoulder much of the mission. On Sunday, 60 sorties were flown, about half of which were by U.S. aircraft. But on Monday, U.S. and coalition forces were expected to fly between 70 and 80 sorties, with allies contributing more than half.

But complicating matters is the fact that most allied militaries, which operate on a fraction of the Defense Department’s yearly allowance, are grappling with budget pressures of their own. While the Pentagon hopes to transfer control to allies in the coming days, the longer the operations over Libya continue, the more difficult it will be for coalition partners to take the lead.

“If it goes on more than a month, we’re going to be in the forefront [of operations] or we’re going to let Qaddafi stick around,” said Zakheim, who served during the George W. Bush administration. “The choices aren’t very pleasant.”

The Center for Strategic and Budgetary Assessment report, a historical analysis of the price for similar operations, provided costs for several different scenarios, ranging from a sweeping and high-priced effort to impose and maintain a no-fly zone over the entire country to a much smaller no-fly zone with limited flyovers and few, if any, attacks on Libyan air defenses or ground forces. The current operation appears to fall somewhere between those two scenarios.

Zack Cooper, a senior analyst at the think tank who coauthored the study with Harrison, acknowledged the operation’s costs are still too difficult to estimate because of lingering questions following the weekend strikes.

“Since we don't yet know the length, magnitude, or degree of U.S. involvement, any cost projections are going to be very rough estimates at this point,” Cooper said.

http://www.nationaljournal.com/nationalsecurity/costs-of-libya-operation-already-piling-up-20110321

The War-Crimes Photos the Army Apologized For

Mar 21, 2011 11:19 AM



This is Cpl. Jeremy Morlock, posing next to an Afghan civilian he killed in cold blood in January 2010. Morlock is one of five soldiers accused of forming a drug-addled "kill team" to murder Afghan civilians for kicks.

The men allegedly documented their crimes with photos and video, and the German newsweekly Der Spiegel published some of them—which had been closely guarded by prosecutors fearing an Abu Ghraib-level reaction in the Arab world—last night. The Army issued a statement last night apologizing for "the distress these photos cause."

Curiously, no U.S. news outlet appears to have published them. Der Spiegel has kept them behind its paywall. A site called Public Intelligence posted them, but it's down now—the site says it can't handle the traffic generated by interest in the pictures. Al Jazeera English posted a thumbnail image.

We got the photos by purchasing Der Spiegel's iPad edition. Here's another posed image.

And another, of two victims posed together.

And here's Morlock and David Bram, another Kill Team member.

Of interest: Morlock, the smiling man pictured above, is from Wasilla, Alaska. His sister April is friendly with Bristol Palin.

http://gawker.com/#!5783976/the-war+crimes-photos-the-army-apologized-for

Ex-Deputy Sentenced To Life For Raping Illegal Immigrant

Posted: 11:03 am EDT March 21, 2011
Updated: 12:09 pm EDT March 21, 2011

MARIETTA, Ga. -- A former Cobb County deputy was sentenced to life in prison for raping an illegal immigrant.

Former Cobb deputy Jason Bill faced a minimum sentence of 25 years behind bars when he was sentenced on Monday. Bill will be eligible for parole.

"You abused the authority of the badge that you have. You used it for your own selfish and depraved purposes. You used it to steal away an innocent and vulnerable victim," said Judge Latain Kell, speaking to Bell.

Bill was convicted just 10 days earlier on seven counts including rape, kidnapping and assault. Prosecutors said he forced the 23-year-old woman to have sex at gunpoint.

The victim was working at a restaurant in Marietta when she said Bill accused her of stealing his phone. The woman said Bill threatened to have her deported then took her to his apartment, handcuffed her to the bed and forced her to have sex.

Bill denied the allegations, and defense attorneys said the woman was a prostitute who Bill paid for sex the night before the attack. They claimed the woman made up the entire story to get a visa.

Channel 2's Ross Cavitt reported the discovery of a white powder at the courthouse caused a partial evacuation immediately following the sentencing. Officials said they had no reason to believe the two incidents were related.

http://www.wsbtv.com/news/27262822/detail.html

The Top 7 Corporate Tax Evaders

By Damien Hoffman
March 14 2011

Want to hear something worth having a tea party about? Some of the largest US corporations have mastered the art of evading taxes by booking expenses in the US and profits in low-tax countries.

As companies send off their corporate tax filings on the March 15th filing deadline, think about the multi-billion dollar corporations which Forbes reports had lower tax rates than you did:

7) Hewlett-Packard

Hewlett-Packard (NYSE:HPQ) earned pretax income of $9.4 billion, but managed to keep their tax rate the same as someone earning less than $33,950 a year. Their trickery? Book profits at lower-tax foreign subsidiaries.

6) Verizon

Verizon (NYSE:VZ) has a lovely 10.5% tax rate. That’s better than a long term capital gain. Although Verizon earned $11.6 billion in pretax income, they have diverted much of their income through foreign wireless partner Vodafone.

5) Chevron

Chevron (NYSE:CVX) paid $8 billion in taxes on $18.5 billion in pretax income. So why did they make the list? Chevron only sent Uncle Sam a check for $200 million. The rest was paid abroad in lower-tax countries. I think they should change their logo colors from red, white and blue to something more representative of the Caymans.

4) Ford Motors

We all know Ford (NYSE:F) and other car makers have been skidding since the recession began. The struggling car maker still managed to earn $3 billion in pretax income. The beauty? Ford only plunked down $69 million in taxes — a 2.3% tax rate.

Not bad considering all the other subsidies, bailouts, and cash for clunkers we’ve already given as gifts to one of the oldest car manufacturers in the world.

3) ExxonMobil

ExxonMobile (NYSE:XOM) did pay $17.6 billion in taxes on $37.3 billion in pretax income. However, unlike Chevron, none of Exxon’s taxes were paid in the US. That’s funny … I think they sell a fair amount of profitable gasoline here.

2) Bank of America

Bank of America (NYSE:BAC) earned pretax income of $4.4 billion in 2009, yet the financial services super market tallied up a $1.9 billion tax benefit.

How could such a travesty occur? Bank of America scoured the tax code for deductions like $860 million in tax-exempt income, $670 million in low-income housing credits, and a $600 million loss on shares of foreign subsidiaries.

Making matters worse for the US Treasury, Bank of America has a provision for credit losses of $49 billion which will carry over for a long, long time.

1) General Electric

Like those who received an Earned Income Credit (EIC), General Electric (NYSE:GE) actually made money on their tax filing this year! Although the industrial behemoth generated $10.3 billion in pretax income, they recorded a tax benefit of $1.1 billion. Don’t we all wish we could be in that bracket.

But big tax breaks are nothing new for the 12th largest company in the world. In 2008, GE’s effective tax rate was 5.3% versus the marginal US corporate rate of 35%. In 2007, it was 15%. You’d think GE would at least pay a little more for paper and administration costs considering their tax filing to the IRS is an astounding 24,000 pages when printed out.

http://wallstcheatsheet.com/breaking-news/economy/the-top-7-corporate-tax-evaders.html