A gambler counts out cash while making a proposition bet on Super Bowl XLV at the Las Vegas Hilton in Las Vegas, Nevada January 27, 2011. The Pittsburgh Steelers and the Green Bay Packers will compete in Super Bowl XLV in Arlington, Texas on February 6. REUTERS/Las Vegas Sun/Steve Marcus (UNITED STATES - Tags: SPORT FOOTBALL)

US investor has to pay $1 billion in taxes by Tuesday

$1 billion

US investor John Paulson will have to pay about $1 billion in federal and state taxes by April 17, according to the Wall Street Journal, on top of $500 million he already paid to the Internal Revenue Service in 2017.

Published   |  Photo by Reuters/Las Vegas Sun/Steve Marcus
A gambler counts out cash while making a proposition bet on Super Bowl XLV at the Las Vegas Hilton in Las Vegas, Nevada January 27, 2011. The Pittsburgh Steelers and the Green Bay Packers will compete in Super Bowl XLV in Arlington, Texas on February 6. REUTERS/Las Vegas Sun/Steve Marcus (UNITED STATES - Tags: SPORT FOOTBALL)
$1 billion

The huge tax bill is due to a bet Paulson made (and won) ahead of the financial crisis. He anticipated the crunch and bet against subprime mortgages, making $15 billion for his fund and $4 billion for himself.

A gambler counts out cash while making a proposition bet on Super Bowl XLV at the Las Vegas Hilton in Las Vegas, Nevada January 27, 2011. The Pittsburgh Steelers and the Green Bay Packers will compete in Super Bowl XLV in Arlington, Texas on February 6. REUTERS/Las Vegas Sun/Steve Marcus (UNITED STATES - Tags: SPORT FOOTBALL)
$1 billion

But using an IRS perk available to hedge fund managers at the time, Paulson managed to defer tax payments over that sum—until now.

A gambler counts out cash while making a proposition bet on Super Bowl XLV at the Las Vegas Hilton in Las Vegas, Nevada January 27, 2011. The Pittsburgh Steelers and the Green Bay Packers will compete in Super Bowl XLV in Arlington, Texas on February 6. REUTERS/Las Vegas Sun/Steve Marcus (UNITED STATES - Tags: SPORT FOOTBALL)
$1 billion

The deadline comes at a complicated moment. Paulson’s hedge fund is less prosperous now than it was after the crisis. While it managed $38 billion in 2010, it manages $9 billion now.

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