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Opinion: Would the Joe Biden of 2017 be a target of the Joe Biden IRS of 2024?

From 2017 to 2021, Biden was a private citizen and he and his wife, Jill, earned more than $16 million from consulting, book deals and speaking engagements. According to his tax returns, together they had an adjusted gross income of $11 million in 2017, $4.5 million in 2018 and $985,000 in 2019, at which point he was campaigning for president. Over that 3-year period, he directed much of that money into an S corporation that the couple had established for their post-government business. In 2017, Biden paid himself, through the S corporation, a salary of $145,000 and his wife took out $100,000 in salary, totaling about 2 percent of that year’s income to the S corporation. The next year the couple took out about 13 percent of the company’s income as wages. In 2019, they took out about 60 percent. Why is this? How can that percentage grow so much in 3 years?

While tax laws are complex, the answer is simple: the Bidens wanted to avoid paying more than the law required them to. Had they taken 60 percent of $11 million as wages, they would have owed taxes on $6.6 million in wages. Including federal income taxes, social security taxes, Medicare taxes of 2.9 percent, and potentially the 3.8 percent Net Investment Income Tax created with the enactment of Obamacare in 2010, as well as state taxes in Delaware. It is typical of Washington elites to avoid an extra $191,000 to Medicare and likely a similar amount in NIIT to the federal Treasury.

The percentage taken out climbed each year, not because they paid themselves more, but because the S Corp took in less. This is presumably because the optics of getting paid to do campaign speeches, which is what both Bidens were doing beginning in 2019, would have been pretty bad. So, they capitalized on the opportunity to make a bunch of money giving speeches right after leaving office, paid taxes according to the law on that income, and then mostly lived off that until he moved into 1600 Pennsylvania Avenue in 2021.

Today, when President Joe Biden is out the campaign stump, he accuses regular citizens for not paying their “fair share” as if they are shirking a patriotic duty by paying what the law allows rather than some arbitrarily assigned number by moralists seeking reelection in order to spend other peoples’ money.

Biden is also overseeing the largest expansion of the IRS’s enforcement activities in the history of the nation, with billions of dollars being used to audit and investigate companies of all sizes and types…including S corporations, partnerships and other pass-through entities.

Let’s hope the IRS remembers how it treated private citizens Joe and Jill Biden when they were filing their taxes as a business owners when it goes looking for farmers, shop owners, landscapers, and other patriots who they might think are not paying “their fair share.”

Let’s also hope that our leaders in Congress take action to protect business partnerships from IRS targeting and vilification. Fortunately, for Missouri, we have Congressman Jason Smith serving as Chairman of the powerful House Ways and Means Committee. We need strong leaders like Chairman Smith to speak out against the onslaught of audits and enforcement actions by the IRS and protect business partnerships.