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Fannie Mae Says Tax Cuts Hurt, 3 Billion In Treasury Assistance Needed

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Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
Money_squeezed.jpg

Fannie Mae Says Tax Cuts Hurt, $3 Billion in Treasury Assistance Needed
Fannie Mae will need $3.7 billion from the U.S. Treasury to prevent its net worth from becoming negative in March, Bloomberg reported Feb. 14. The government-sponsored enterprise hasn't required taxpayer funding since 2012, but newly passed cuts to corporate taxes led to a $6.5 billion fourth-quarter loss. > FULL STORY
https://www.bloomberg.com/news/arti...t-bailout-funds-since-2012-after-tax-cut-loss
 

Randolph Kinney

Elite Member
Joined
Apr 7, 2005
Professional Status
Retired Appraiser
State
North Carolina
Just an an accounting game of valuing assets. The higher the tax rate, the higher the value of assets used to offset taxes. Cutting taxes reverses that game.

The deficit was driven by a $6.5 billion loss in the fourth quarter, which came as a result of a drop in the value of assets Fannie can use to offset taxes. The assets became less valuable when Congress cut the corporate tax rate, resulting in a $9.9 billion hit.
 
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