Hedge fund honcho wins $27 million tax fight with NYC

Billionaire hedge fund manager Julian Robertson won a $27 million tax case after convincing a a judge that he wasn't a resident of New York City in the year 2000 -- and it all came down to four days.

The way the law works is that anyone who spends more than half the year living in New York City is subject to the jurisdiction's taxes -- in 2000, the top tax rate was 3.78%, meaning that Mr. Robertson must have earned around $700 million in the year 2000.

The New York State Department of Taxation and Finance argued that because he couldn't provide proof that he didn't spend more than half the year in New York City, he had to pay the tax. Robertson and his lawyers, family, and his assistants spent countless hours pouring over schedules, calendars, tickets, etc. to convince a judge that he spent less than half the year in NYC proper -- with a good chunk of the rest of his time spent on Long Island.

According (subscription required) to The Wall Street Journal, "At issue was Mr. Robertson's whereabouts on four days during that leap year: April 15, July 23, July 31 and Nov. 16. The other 362 days were accounted for, with documentary proof of 183 days spent in the city and 179 spent outside."

By convincing a judge that those four days were spent outside of the city, Robertson was able to tip the scales to 184 days outside the city and 183 within its limits. . . thereby saving himself $27 million by slumming it on Long Island for one extra night.

I guess the takeaway is this: If you earn a lot of money and want to live in New York City, get a house close by and spend half the year there.
Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.