In the last few years, two different billionaire investors settled tax disputes that ended in large payments to the federal government.
In 2019, Robert F. Smith, founder and CEO of the private equity firm Vista Equity Partners, paid a $140 million fine to federal authorities and agreed to forego $180 million in charitable deductions for failing to pay taxes on a portion of his firm's profits moved to an offshore account.
Two years later, an investment company founded by Jim Simons called Renaissance Technologies was fined $7 billion for its long-running efforts to shoehorn short-term capital gains into the category of long-term capital gains because those are taxed at a lower rate.
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