24 October 2013

Taxpayers To Help Pay JP Morgan’s Fine For Causing 2008 Financial Crisis

Taxpayers To Help Pay JP Morgan’s Fine For Causing 2008 Financial Crisis

Feeling generous? You should because you are about to help pay for JPMorgan’s $13 billion fine for causing the 2008 financial crisis. According to tax experts the money JPMorgan will be paying to the government ($9 billion) and to wronged customers ($4 billion) can be written off as a “business expense.” In other words, JPMorgan may be sticking the taxpayers with the bill.

Section 162(f) of the tax code bars deductions for fines and penalties paid to the government, but JPMorgan might be able to negotiate an agreement to classify the payments as something else. Those payments labeled compensatory or for restitution are more likely to be deductible.

“These are big numbers,” said Alan Feld, a law professor at Boston University. “I’m not sure that I as a taxpayer am so happy about helping JPMorgan to pay.”

Read more at FireDogLake

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