The IRS commissioner Daniel Werfel was grilled on Capitol Hill on Tuesday on whether a $200,000 “loan” with low or no interest that wasn’t reported to the IRS might be a tax issue… for, hypothetically, the President of the United States.
Rep. Virginia Foxx, Republican from North Carolina, pressed Werfel on whether or not a “loan” for a family member might qualify as a “taxable gift,” and therefore had to be reported in a certain matter for the purpose of taxing interested at the Applicable Federal Rates [AFR].
Transcription of the exchange follows.
FOXX: Okay. So if someone gave his or her family member, including a brother a loan, would that person have to charge an interest rate equal to or higher than the current AFR [Applicable Federal Rate]?
WERFEL: I don’t believe they would have to charge an interest rate, but again, if you’re going to walk me into a hypothetical, I’d want to make sure that I’m getting it right and consult with my team, but I don’t think they’re required to provide an interest rate. It depends on whether they’re going to treat it as a gift or a loan, and there’s a lot of implications there.
FOXX: Well, then I have a follow-up. If a rate less than, it’s my understanding that there is an AFR and that it is to be charged, but if the rate is less than the AFR, so if it’s somebody gives you a loan and they don’t charge you an interest rate, then the loan is technically a gift which carries certain tax implications. Is that correct?
WERFEL: Yes.
FOXX: Yeah, you answered ‘yes.’
WERFEL: Sorry. Yes.
FOXX:: Yes. Okay. So if someone gave his or her family member a personal loan of say, $200,000, but an interest rate equal two or higher than the AFR at the time was not charged, would that loan then be considered a taxable gift?
WERFEL: Again, you’re getting into a hypothetical where I’d want to know a lot of other facts and have expert accountants with me advising. So I think it’s dangerous for me to say yes or no unequivocally on a fact pattern where I’d probably need a lot more information. There might be other countervailing factors in play that would impact the,
FOXX: Well. Now what kind of countervailing factors would you hypothesize?
WERFEL: Well, I mean, I’m not sure where you’re going with your fact pattern. I don’t know the circumstances… whether there’s someone that’s been deceased, the timing of this issue.
FOXX: Yeah, I’m just trying to determine if this loan does not have interest charge to it, then would that be considered a taxable gift and other factors may come into play… Is it a taxable gift?
WERFEL: I don’t know the amount…
FOXX: Well, I use 200,000.
WERFEL: Okay, fair enough. Again, at risk of walking through a hypothetical where I don’t know the facts as a general matter, yes, there’s a tax, you’re describing a situation that may have a taxable event.
FOXX: Okay, great. Glad we were able to establish that.
House Oversight Chair James Comer (R-KY) on Monday laid out the many glaring problems with President Joe Biden’s claim that the $200,000 check cut to him by his brother James Biden was in return for a “loan.”
“But let’s say they pulled something out of their rear end… and say they made a loan to his brother for $200,000. His brother could not have paid that loan back without influence peddling…”
House Oversight Chair James Comer (R-KY) lays bare the “huge problem” with the… pic.twitter.com/Nlga4SI9Jw
— Kyle Becker (@kylenabecker) October 24, 2023
“We have Jim Biden’s bank records,” Comer said. “and I can say with 100% confidence that he had very little money in that checking account for a long time, and the only way he could have paid that back was with that $200,000 payment.”
“So either Joe Biden was paid $200,000 as part of the Influence peddling scheme, payback, kickback, dividend, whatever you want to call it, or Joe Biden actually made a loan to his brother, and because his brother influence-peddled AmeriCorps Health, he paid him back $200,000.”
“But let’s say they pulled something out of their rear end… and say they made a loan to his brother for $200,000. His brother could not have paid that loan back without influence peddling,” he added.
Former White House ethics chief Richard Painter of the Bush administration stated that President Biden could face severe consequences if he is unable to produce proof that the alleged loan is genuine, and demanded that his subordinates produce the receipts.
He stated, “What is absolutely critical here is to find documentation of the original loan from the President to his brother, and the President should produce that.”
“If there was no loan, there are serious questions about whether this was income for tax purposes in 2018. That’s really a huge problem.”
Yes it’s called a Bribe or Extortion, depending how you look at it!!!
Either way a CRIME! TREASON