Due to a little-known provision in federal law, members of President Biden’s Cabinet can postpone paying taxes; they can do this while divesting their assets to avoid conflicts of interest once they begin public service.
It sounds complicated but here is how it works: Section 2634 of the federal election legislation contains a one-of-a-kind measure; this measure helps mitigate the financial impact of fresh administration members selling off assets unexpectedly. This is also known as certificates of divestiture.
The Office of Government Ethics has offered this tax provision since 1989. It has assisted administration personnel and appointees — including Cabinet members — in deferring capital gains taxes when they are compelled to sell assets as part of their entry into public service.
Appointees and employees of the government can defer paying capital gains taxes if they reinvest their profits in less-conflicted investments like mutual funds and treasury bonds.
Energy Secretary Jennifer Granholm
Biden Cabinet members avoid huge tax hits thanks to little-known federal lawhttps://t.co/NtqyS1jY52
— Fox News (@FoxNews) June 4, 2021
According to financial disclosure forms reviewed by Fox News, Energy Secretary Jennifer Granholm has two certificates of divestiture: one for interests in a variety of firms, including Apple, and one for 240,520 shares in electric car firm Proterra, where she previously worked.
After several weeks marred by scandal from a Biden drop-by to the company selling electric cars (previous to Granholm’s withdrawal from the company), Granholm recently sold her Proterra stock.
Granholm will be able to postpone paying millions in capital gains taxes because of her certificate of divestment. Granholm likely received more money from her sale than she would’ve if she sold before Biden’s presidential visit improved Proterra’s worth.
Granholm isn’t Alone
The list of cabinet officials Includes the following: Secretary of State Anthony Blinken, Special Climate Envoy John Kerry, Attorney General Merrick Garland, Treasury Secretary Janet Yellen, Commerce Secretary Gina Raimondo, and Secretary of Defense Lloyd Austin.
Austin also has two divestiture certificates. This is according to financial disclosure papers examined by Fox News.
— Antony Blinken (@ABlinken) February 6, 2021
Virginia Canter (a key player for the watchdog group Citizens for Responsibility and Ethics in Washington (CREW)) told Fox News that an official delaying capital gains taxes on divested assets would pay the taxes when they sold the new investment, not the old one.
The Biden Cabinet’s Ties to Dark Money
President Biden’s administration has been bolstered by a group of people with strong ties to leftist groups that get anonymous money. This includes chief of staff Ron Klain, who might serve as a conduit for certain groups to advance their objectives via the White House.
Ron Klain, Biden's powerful chief of staff, leads White House rife with dark money ties https://t.co/oXyz1ky28I
— Fox News (@FoxNews) May 6, 2021
Klain now assists in directing Biden’s political agenda from the White House.
Klain also has ties to the Center for American Progress (CAP) Action Fund, which is run by an associate of none other than Hillary Clinton, John Podesta, and is situated in Washington, D.C.
For numerous years, Klain served on the board of directors of the organization, which never reveals its contributions on tax filings.