Billionaire hedge fund manager David Tepper, 58, is moving south. He won’t be punished for being rich. Tepper relocated and escaped a heavy tax bill in New Jersey so he can enjoy Florida’s sun and income tax ease.
In October 2015, Tepper registered his condo in Miami Beach as his permanent address. By December, he filed paperwork declaring his Florida residency. On New Year’s Day, he chucked up the deuces and relocated his firm, Appaloosa Management, to Florida from New Jersey where he enjoys no personal income and estate taxes.
New Jersey’s state tax office won’t be too thrilled about losing an estimated $140 million in revenue they forecasted they’d collect from Tepper.
“We may be facing an unusual degree of income-tax forecast risk,” Frank Haines, budget and finance officer with the Office of Legislative Services told a Senate committee last week in Trenton, NJ.
New Jersey relies on personal income taxes for about 40 percent of its revenue, and less than 1 percent of taxpayers contribute about a third of those collections, according to the legislative services office. A one percent forecasting error in the income-tax estimate can mean a $140 million gap, Haines explains.
Daily Mail reports:
For decades, Florida has had one of the lowest tax burdens in the country, according to the independent research organization Tax Foundation.
The strength of Florida’s low tax burden comes from its lack of an income tax, making it one of seven such states in the U.S. The state constitution prohibits such a tax, though Floridians still have to pay federal income taxes.
Florida also does not assess an estate tax, or an inheritance tax. No portion of what is willed to an individual goes to the state.
Floridians no longer need to pay taxes to the state on intangible goods, such as investments. The law requiring that tax was repealed in 2007.
Tepper’s estimated net worth is $11.4 billion. The self-made millionaire ranks high on several of Forbes‘ lists. Currently ranking No. 38 on the Forbes’ 400. He also ranks No. 4 as one of the highest earning hedge fund managers. He was educated at bachelor of arts from the University of Pittsburgh and master of business administration from the David A. Tepper School of Business, is married with three children.