Paul L. Caron

Friday, June 3, 2011

Will the Gift Tax Save John Edwards?


With today's indictment of John Edwards on charges that he violated campaign-finance laws by accepting $925,000 from donors to conceal an extramarital affair with Rielle Hunter and resulting pregnancy, one element sure to be central to his defense is that his major donor treated the payments as gifts and reported them on gift tax returns.  From the Los Angeles Times:

The money came from two Edwards supporters — his national campaign finance chairman, Fred Baron, who died in 2008, and banking heiress Rachel "Bunny" Mellon, who is 100. ...  Mellon provided about $700,000. ... According to Mellon's attorney, she gave the money to Edwards as a personal gift and filed a gift tax return.

See also Huffington Post, DOJ is Wasting Time and Money on Edwards Case: "Edwards' lawyer says that one of the donors, the heiress Bunny Mellon, considered this money a personal gift to Edwards and filed a gift tax return." For more on today's developments, see::

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» Rarely-filed gift tax could factor in John Edwards' campaign hush money charges from Don't Mess With Taxes
The U.S. Treasury gets its money from a variety of tax sources. Collections data for 2010 show that gift taxes accounted for more than $ 2.7 billion. That's a lot of money, but it was only a fraction, literally, of the almost $1.9 trillion in taxes tha... [Read More]

Tracked on Jun 5, 2011 7:03:45 AM


If the gift tax return was filed.. drop the case. Edwards may be a cad..but we do not need more people in our jails.

Posted by: Nick | Jun 6, 2011 8:49:12 AM

I don't see the point of this prosecution.

Posted by: mike livingston | Jun 4, 2011 5:40:10 AM

If campaign finance violations were prosecuted as criminal law then the Congress would be meeting in the Annex to the Warden's Office in Sing Sing.

What John Edwards has done in his personal life is far more criminal (in the dispicable context, not necessarily the legal context) than any campaign finance laws that he may or may not have broken.

Posted by: Sid (real one) | Jun 3, 2011 6:05:44 PM