So all these people who invested with this crook were "making" big returns over the years. I supposed he was "buying and selling" stocks and reinvesting "money" back into the market. Of course, this would show on year end reports, 1099 forms, dividend reports, ect. And that would include large tax liabilities. Are all these people at least able to recover the taxes they paid on money they really didn't earn; and also refile taxes and get refunds for theft of their money?
The money was supposedly "invested" in numerous types of accounts sheltered from taxes (IRA's, bonds, funds, etc.,etc.).....you don't pay taxes until you take possession of the profits (capital gains, etc.)
The whole idea was to tie the money up in places where people wouldn't WANT to take it out.
No gains, no taxes.
... is still living off of other people's money. Taxpayers are paying for his room & board now.
He ought to just hang himself like his loser boy did.
"He ought to just hang himself like his loser boy did."
Come on now Dan, I've always expected better out of you.
I believe when they looked into Madoffs real books, they discovered he hadn't made a stock market trade in years. I think it was 10 or 15 years. Some people had withdrawn money from Madoff before the discovery, and they were just paid off with other people's "investment" deposit. I've heard the FBI is trying to recover funds paid out by Madoff so the money can be divided more evenly. As for the taxes, I also heard on CNBC that the IRS allows taxes to be refiled for a period of 5 years, and some of Madoff's victims who where not in tax sheltered accounts (i.e. paid taxes on their "paper profits") would be refunded. But, a 5 year recovery period probably only scratches the surface for long time investors.
It's hard to see how the kind of money Madoff investers were sending him could have been put into retirement accounts or tax shelter accounts only. For the retirement accounts there are limits and for tax shelter accounts there are usually low returns. He was sending out statements with 10-20 percent a year gains; every year- and on large accounts. There had to be big tax payments.
Yeah, I agree, it's something like $5000/yr for an IRA, and I beleive high income earners are excluded from the tax benifits of an IRA all together. With a regular investment account, which I'm sure most of the Madoff victims had, you have to pay taxes on all the buy/sell profits every year. IIRC, Madoff claimed to be an options trader, which I don't completely understand, but I'm pretty sure there are no long term holdings (which can be free of taxes for many years, until sold) in options trading. There were probably a lot taxes paid on fake earnings reports ...
