Private Prison Companies Find Loophole to Avoid Taxes

Apr25

by Fourtoedjones on April 25, 2013 at 9:46 am

An obscure tax loophole intended for real estate trusts is now being used by private prison companies and other businesses to avoid paying federal taxes.

Real estate investment trusts (REIT) were created during the Eisenhower administration to help companies that concentrate their business in real estate holdings by reducing or even eliminating the payment of corporate taxes. Typical REITs are companies that own shopping centers, malls, office buildings, apartments and mortgages. But now Corrections Corporation of America (CCA) is using REIT status as a “golden ticket” to reduce its tax bill.

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