I love that quote from Woody Guthrie (H/T to Citizens for Tax Justice for using it). Says it all, from the halls of the Chamber of Commerce to the corporate suites to the Congress. Today's use of the fountain pen comes courtesy of another corporate scam to avoid taxes.
And the folks at CTJ explain how the corporate fountain pen is turning the Real Estate Investment Trust (REIT) into the newest tax dodge. First, what is an REIT?:
A REIT is to real estate what a mutual fund is to stock and bonds: a way for smaller investors to diversify their holdings by owning a share of a large pool of assets rather than owning individual stocks or properties directly. A REIT, just like a mutual fund, doesn’t pay an entity-level tax. Instead it distributes its income to the REIT shareholders who pay tax on their respective shares.
[emphasis added]
Except 75 percent of the trust's biz has to be in real estate...uh, that's why it's called a "real estate investment trust". But, corporations like Wal-Mart and Windstream Holdings, Inc. have now found a way to scam the taxpayers:
Windstream Holdings is a Fortune 500 company that, according to its website, “is a leading provider of advanced network communications, including cloud computing and managed services, to businesses,” and offers “broadband, phone and digital TV services to consumers.”
It shouldn’t qualify as a REIT. As Windstream itself said, the company is putting its copper and fiber networks into the REIT along with “other” real estate.
....
Is Windstream in the business of providing communications services or owning and managing real estate? Is Corrections Corporation in the business of operating prisons or holding real property? Are casino operators in the business of real estate or emptying your wallet?
....
We don't need these companies to spin off their “real estate” assets so small investors can own a piece. These companies are already publicly traded and investors can buy stock or mutual funds that hold the stock.[emphasis added]
Yeah, its boring lingo and complicated for the average person to wrap their brains around.
Bottom line: it's legal (yes) but a misuse, abuse, and, IMHO, a scam that robs us, the public, of revenue that should go to build society.