Tuesday, November 1, 2016
New York Times, Donald Trump Used Legally Dubious Method to Avoid Paying Taxes:
[N]ewly obtained documents show that in the early 1990s, as he scrambled to stave off financial ruin, Mr. Trump avoided reporting hundreds of millions of dollars in taxable income by using a tax avoidance maneuver so legally dubious his own lawyers advised him that the Internal Revenue Service would most likely declare it improper if he were audited.
Thanks to this one maneuver, which was later outlawed by Congress, Mr. Trump potentially escaped paying tens of millions of dollars in federal personal income taxes. It is impossible to know for sure because Mr. Trump has declined to release his tax returns, or even a summary of his returns, breaking a practice followed by every Republican and Democratic presidential candidate for more than four decades.
Tax experts who reviewed the newly obtained documents for The New York Times said Mr. Trump’s tax avoidance maneuver, conjured from ambiguous provisions of highly technical tax court rulings, clearly pushed the edge of the envelope of what tax laws permitted at the time. “Whatever loophole existed was not ‘exploited’ here, but stretched beyond any recognition,” said Steven M. Rosenthal, a senior fellow at the nonpartisan Tax Policy Center who helped draft tax legislation in the early 1990s.
Moreover, the tax experts said the maneuver trampled a core tenet of American tax policy by conferring enormous tax benefits on Mr. Trump for losing vast amounts of other people’s money — in this case, money investors and banks had entrusted to him to build a casino empire in Atlantic City. ...
[T]he opinion letters Mr. Trump received from his tax lawyers at Willkie Farr & Gallagher were far from the gold standard. The letters bluntly warned that there was no statute, regulation or judicial opinion that explicitly permitted Mr. Trump’s tax gambit. “Due to the lack of definitive judicial or administrative authority,” his lawyers wrote, “substantial uncertainties exist with respect to many of the tax consequences of the plan.”
- New York Times, Donald Trump's Lawyers' Warnings on Tax Maneuver
- New York Times, How Donald Trump Avoided Paying Taxes Using Other People’s Money
- New York Daily News, Donald Trump’s Advisers Warned That His Federal Tax Dodge Was Almost Fraud
- Sam Brunson (Loyola-Chicago) & David Herzig (Valparaiso), On Trump and Tax Opinions
- International Business Times, Was Donald Trump's Tax Loophole Use Illegal?
- Los Angeles Times, Trump's Tax Dodge Skirted the Edge of the Law
- Dan Shaviro (NYU), Latest on Trump Tax Scam
- Slate, We Now Have an Even Clearer Picture of How Brazenly Trump Tried to Avoid Paying Taxes
- Tax Notes, Documents Reveal Dubious Tax Planning Behind Trump's Big Losses
- TaxVox, Trump’s $916 million of NOLs: The Art of the Dodge?
- ThinkProgress, Trump May Have Used Illegal Scheme to Avoid Paying Taxes
- Vanity Fair, How Donald Trump Used Other People's Money To Avoid Paying Taxes
- Vox, Two Experts Say Donald Trump Should be Investigated for Criminal Tax Evasion