How The Trumps Dodge Taxes
July 15, 2020
This year, Tax Day comes in the middle of a global economic and public health crisis. While much of America struggles to pay bills and retain employment, here is what we know about how Trump took advantage of the system for his own personal and political gain, and how he and his family have used tax fraud, evasion, and bribery to avoid paying their fair share – or anything close to it. This is only what we know from reporting – since despite eight presidents releasing their taxes in office and when running for president – Trump has refused to demonstrate any modicum of transparency.
Trump Broke His Promises And Has Gone Through Great Lengths To Keep His Tax Returns Hidden — What Is He Hiding?
Trump has broken with decades of precedent and refused to release his taxes, despite saying for years that he would if he ran, and suggesting that candidates are hiding something if they don’t. He’s gone even further than refusing to release his taxes – he has repeatedly sued to block the release of his taxes. And, in addition to being Tax Day, today is also the deadline for Trump to tell a federal judge in Manhattan whether he will further challenge a subpoena forcing him to release his tax returns as part of an ongoing investigation into hush money payments made during the 2016 election.
We Already Know Trump Avoided Paying Taxes In These Five Years — And Apparently Maneuvered To Avoid Paying Taxes For 18 More Years After That
Donald Trump consistently avoided paying income taxes over decades. He paid no federal income taxes in 1978, 1979, and then again 1984. In 1991 and 1993, Trump claimed losses on his Atlantic City casinos that would allow him to reduce or eliminate his federal tax bill for years. And in 1995, he declared a $916 million loss that could have allowed him to avoid taxes for up to 18 years.
Tax Avoidance 101: Multiple Fraudulent Schemes To Lowball Value Of Trump Family Assets
A New York Times report found that the Trump family was “relentless” in finding ways to transfer assets tax-free, potentially reducing their tax payments by over $500 million. The schemes, which Donald Trump participated in, helped him rake in at least $413 million from his father.
Beginning in 1962, Fred Trump transferred over 1,000 apartments to his children without paying gift taxes, and lowballed the value of the gifts at less than one-tenth of their actual value. The Trumps fraudulently diminished the value of Fred Trump Jr.’s estate by over $74 million in order to reduce their taxes. In 1987, Fred Trump gave Donald Trump an untaxed gift of more than $15 million. In 1995, the Trumps fraudulently reduced the value of nearly $900 million worth of assets to just over $40 million for tax purposes, and they claimed that buildings that were potentially worth over $100 million had a value of negative $5.9 million. Fred Trump illegally avoided taxes by splitting his stakes in major businesses into non-controlling minority interests.
In an “overt fraud,” the Trump family set up a company that siphoned millions from Fred Trump’s businesses to his children by marking up purchases already made by his employees. Fred Trump then used the padded receipts to justify bigger rent increases for thousands of tenants. Prosecutors say that the Trump family’s padded invoices could have led to criminal charges at the time.
Trump’s Tactics: Bribes, Fraud, And Lawsuits
Donald Trump has a long history of using bribes and fraud to lower his property taxes, and has continued to fight his property appraisals as president. New York City employees and at least one former Trump employee claimed that Trump paid bribes in order to lower his tax bills in the 1980s and 1990s, saving Trump more than $100 million. A 2016 review found that Trump has been involved in property tax disputes almost every year since the 1980s and he has continued to fight property taxes during his presidency.
When Trump became president he had at least half a dozen active disputes with local governments, raising conflicts of interest. In 2017, the Trump Organization lobbied to cut its property tax bill for its Westchester golf course in half, a tax break of nearly $250,000. That year alone, Trump’s company filed at least six lawsuits in Manhattan challenging property taxes and showed tax officials lower profits than the profits they showed to lenders. In 2018, Trump sued Palm Beach County over its valuation of his Jupiter golf course for the fifth year in a row, claiming it was worth less than $19.5 million despite claiming on financial disclosure it was worth over $50 million. And his DC hotel saw its tax bill slashed by nearly $1 million after the Trump Organization provided information showing the hotel did not perform as well as expected in its first year. And finally, in 2020, a Chicago Trump tax appeal for $1 million was the subject of two investigations seeking to find out whether a Republican state official pressured staff to cut Trump’s taxes.
Nothing’s Too Low: Taking Advantage Of Charity Funds
Donald Trump was forced to shut down his tax-exempt non-profit over allegations that he used it for personal and political gain. Trump shut down the Trump Foundation in 2018 following a lawsuit from New York’s attorney general alleging “persistently illegal conduct.” New York alleged that Trump gave control of the charity to his campaign, disbursing funds in key early-voting primary states, and that he used charity funds to benefit his own business and enroll his son in Boy Scouts.