Tax Law
Senate committee urges investigation of wealthy clients who avoided taxes in Puerto Rico
Two lawyers are part of a U.S. Senate inquiry urging the Internal Revenue Service to investigate wealthy Americans who may have been advised to abuse a Puerto Rico tax break. (Image from Shutterstock)
Two lawyers are part of a U.S. Senate inquiry urging the Internal Revenue Service to investigate wealthy Americans who may have been advised to abuse a Puerto Rico tax break.
The Senate Finance Committee is looking at whether some wealthy Americans moved to Puerto Rico to take advantage of Act 60, a special tax break, and improperly used it to avoid being taxed on income earned while within the 50 states in the United States.
The IRS is investigating about 100 people who may have misused the tax incentive, including some who possibly were given advice by attorneys Jeffrey Rubinger and Summer LePree, former partners at the international law firm Baker McKenzie, according to reporting by the New York Times.
Last year, the Senate committee was tipped off by a whistleblower that Dan Morehead, founder of a large cryptocurrency investment company called Pantera Capital, avoided paying over $100 million in federal taxes and received advice from Rubinger and LePree.
Sen. Ron Wyden, a Democrat from Oregon, sent a letter to the IRS on April 29 questioning the legal advice given by the two lawyers. Both attorneys currently work at Winston & Strawn and deny any wrongdoing.
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