~ Minnesota bank tax avoidance hurting Minnesota ~

Bank of America Tax Avoidance
• BofA is the largest bank and 5th largest corporation in America
• BofA holds over $2.2 Trillion in assets
• BofA in 2009 earned a pretax income of $4.4 Billion.
• BofA received $45 Billion in tax payer bailout funds in 2008 and 2009
• BofA paid ZERO federal income tax in 2009
• BofA actually received at least a $1.9 Billion tax benefit from the government in 2009
• BofA took deductions of at least $2.1 Billion in 2009
• Bank of America operates 371 tax-sheltered subsidiaries, more than any other big bank studied, and 204 subsidiaries in the Cayman Islands alone, according to its latest regulatory filings.


In its 2010 annual report, Bank of America reported a total combined (federal, state, foreign) cash income tax refund of $6.3 billion. This offers further evidence of the bank’s significant federal income tax refund for 2009.



Wells Fargo Tax Avoidance

Wells Fargo reportedly received a $4 billion federal income tax refund on $18 billion in pre-tax income in 2009, and paid 7.5% of its pre-tax income of $19 billion in 2010 in federal taxes. Its net federal income tax benefit for 2009 and 2010 combined, $2.5 billion, is equal to the Obama administration’s proposed
cuts of 50% to the Low-Income Home Energy Assistance Program.


Wells Fargo net income tax benefit ($3.95 billion) for the two years is roughly equal to the Obama administration’s proposed 50% cut to the Low Income Home Energy Assistance Program, or LIHEAP ($2.5 billion).



Six banks – Bank of America, Wells Fargo, Citigroup, JPMorgan Chase, Goldman Sachs, and Morgan Stanley together paid income tax at an approximate rate of 11% of their pre-tax US earnings in 2009 and 2010. Had they paid at 35%, what they are legally mandated to pay, the federal government would have received an additional $13 billion in tax revenue. This would cover more than two years of salaries for the 132,000 teacher jobs lost since the economic crisis began in 2008.




General Corporate Tax Avoidance
• Two-thirds of all US corporations do not pay federal income tax
• 25% of the biggest US corporations do not pay federal income tax
• US corporations avoid between $37 Billion and $100 Billion a year in US taxes
• President Obama has called for ending corporate tax loopholes in his campaign, the 2010 State of the Union and the 2011 State of the Union

• The “Stop Tax Haven Abuse Act” was not acted upon by the previous Congress.
• Closing special tax loopholes on the financial sector and implementing sensible revenue-raising initiatives such as the Financial Speculation Tax could generate over $150 billion in federal tax revenue each year.



Collectively, states lost approximately $297 billion in tax revenues from late 2008 to 2010 due to the housing bubble collapse.

Unlike cities and the federal government, states cannot borrow money to finance operating costs and must choose between tax increases, spending cuts, or a combination of the two to plug budget holes.As a result of lost tax revenues and projected losses, states face a combined budget deficit of $125 billion for fiscal year 2012, and have already dealt with deficits of $423 billion for 2009, 2010, and 2011 combined.