Top Executives Of Renaissance Technologies Agree To Pay USD 7 Billion To Settle Tax Probe

Anurag Sharma
Anurag Sharma

Updated · Sep 15, 2021

SHARE:

News.Market.us is supported by its audience. When you purchase through links on our site, we may earn an affiliate commission. Learn more.
close
Advertiser Disclosure

At Market.us News, we strive to bring you the most accurate and up-to-date information by utilizing a variety of resources, including paid and free sources, primary research, and phone interviews. Our data is available to the public free of charge, and we encourage you to use it to inform your personal or business decisions. If you choose to republish our data on your own website, we simply ask that you provide a proper citation or link back to the respective page on Market.us News. We appreciate your support and look forward to continuing to provide valuable insights for our audience.

Top executives of a New York hedge fund have agreed to settle a tax probe against them by paying around USD 7 billion in back taxes. Executives of Renaissance Technologies will have to pay back taxes as part of the settlement. Moreover, their spouses too have agreed to penalties. The taxes related to trades made by the quantitative hedge fund. With executives agreeing to pay the amount, it has apparently become the largest tax settlement case in the history of America. With the settlement, the long-running dispute with US tax authorities has come to an end. The dispute was related to trades made through the Medallion fund issued by Renaissance between 2005 and 2015. During that period, several executives of the firm converted short-term capital gains into long-term profits. This benefitted executives as they are taxed at a much lower rate.

Among those who will pay back taxes are Jim Simons and Robert Mercer. Simons, who is a founder of Renaissance, is a mathematician and also a prominent Democratic Party donor. He founded Renaissance almost 40 years ago. As per a letter sent to a group of investors, Simons would pay an additional USD 670 million. On the other hand, Mercer donated a huge amount of money for Donald Trump’s campaign. Mercer has backed several Republican candidates as well. The settlement deal has not affected the common public as the Medallion fund was available to hedge fund insiders along with their family members and friends.

Renaissance chief executive Peter Brown said that the settlement was reached after the board reached the conclusion that it was in the interest of everyone. “Renaissance’s board concluded that agreeing to the resolution with the Internal Revenue Service or IRS would be good for the interest of investors of the relevant period. Reaching on the settlement is better than taking the risk that could have a worse outcome,” the CEO said.

SHARE:
Anurag Sharma

Anurag Sharma

He has been helping in business of varied scales, with key strategic decisions. He is a specialist in healthcare, medical devices, and life-science, and has accurately predicted the trends in the market. Anurag is a fervent traveller, and is passionate in exploring untouched places and locations. In his free time, he loves to introspect and plan ahead.