When Arold and Maria started dating in 77 Arnold had chump change money compared to the Shrivers, but now it is the other way around.
Arnold is the ONLY American to own a Boeing 747 Jumbo Jet, which he leases to Singapore Airlines.
Most of the press made no mention of Oak Productions, or of Legend International Airways, another corporation owned entirely by Schwarzenegger. But an exception was an article in the San Francisco Chronicle last month that featured some analysis by San Francisco accountant Sandy Murray.
In public records, Schwarzenegger has said he is "sole member" of [Legend], which according to the Singapore Business Times paid $133 million in 1997 to buy a Boeing 747 jumbo jet from Singapore Airlines and then leased the plane back for an undisclosed amount.
Schwarzenegger is "taking a bath every year" on the venture, said Murray: $2 million in losses in 2001, $8 million in carry-over losses from the years before that. Without a look at Legend's tax returns, Murray said, it wasn't possible to know whether the losses are for tax purposes—to be recouped by gains when Schwarzenegger finally sells the aircraft—or whether it is just a bad investment.The myth of Arnold the Business Genius
Usually, the term "offshore lease" piques my interest, because it often means that a taxable American entity has conspired to shift income to a foreign tax-exempt entity and claim losses for itself. But Legend doesn't have any income to use the depreciation losses from the aircraft lease: it is carrying unused losses forward.
Schwarzenegger may have thought that leasing an airplane was a great tax shelter. Indeed, corporations are the usual providers of this sort of leases: they take depreciation deductions on aircraft and other things when the companies that (normally) would have bought them lack the taxable income to make use of them. Schwarzenegger miscalculated somewhere. Either he thought that the airplane lease was somehow going to make him tons of actual cash, or he thought that leasing meant significant tax advantages. He was dead wrong either way.
