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Comment by kristopolous | Hacker News Reader

Could this be some tax and investment dance?

Perhaps the money will be used by Harvard to buy a security he holds or has options on washing his hands clean of SEC oversight.

Then he executes on the predictable market move, makes the money back and writes down the donation for taxes. Meanwhile, Harvard is still holding whatever long term position they opened so they too are happy.

Their cover story is some rather cheap commemorative plaque they put on a wall "thanking" him.

I'm not saying this IS what happened but the facts are a hedge fund guy "donating" lots of money to a tax deductible nonprofit that has a giant investment portfolio with rather lax regulatory oversight.

Also if I was working for Harvard, I'd absolutely think of offering services like this to court donations.

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Even without all that, donating highly apprechiated assets is super useful for taxes because you not only get to deduct the value from your ordinary income, you also don't have to pay capital gains on the disposition of the asset.

I don't know where Mr. Griffin pays taxes, but if you have the right conditions, donating apprechiated assets is very inexpensive.

For example, if you're in california with oodles of income, your ordinary income will be at a marginal rate of 37 federal and 12.3 state, and your capital gains will be a total of 23.8 federal (includes niit) and again 12.3 state. So donating $1 of highly apprechiated assets avoids 26.1 cents of tax, and allows a deduction for 49.3 cents; it has the same effect on wealth as donating 14.6 cents. So it may have only cost $44M to donate $300M.

Of course, most people don't have $300M of ordinary income to deduct against, and aren't at the highest of the high brackets (and Mr. Griffin has residences in no income tax states, so he may not pay state income tax on capital gains anyway)

I think neither a 40-billionaire nor Harvard would risk legal trouble by pulling off such an easily auditable maneuver.

Maybe it sounds conspiratorial but if such schemes were available, I believe Harvard is too well connected to be subject to such scrutiny by those with the power to do such an audit.

The idea that people tossing around hundreds of millions of dollars are on the up and up otherwise they would have consequences doesn't seem to have much historical evidence supporting this dynamic

The Paradise papers leak outlined a lot of these schemes

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