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Trump helped parents hide money on tax returns – New York Times New York tax authorities investigating Trump fraud allegations
(about 3 hours later)
Donald Trump engaged in tax schemes that included cases of fraud in which he and his siblings helped their parents dodge taxes, the New York Times reported on Tuesday. New York state tax authorities are investigating after the New York Times reported that Donald Trump engaged in “dubious tax schemes during the 1990s, including instances of outright fraud”, as he and his siblings took control of a real estate empire built by Fred C Trump, the president’s late father.
The Times investigation, which a Trump lawyer said was inaccurate, cited a “vast trove” of confidential tax return and financial records to show Trump received the equivalent today of at least $413m from his father’s real estate business. “The tax department is reviewing the allegations in the NYT article and is vigorously pursuing all appropriate avenues of investigation,” the state taxation authority told the Washington Post.
The Times reported that much of that fortune came to Trump because he helped his parents evade taxes, setting up a fake corporation with his siblings to disguise millions of dollars in gifts from their parents. In a blockbuster investigative report built on interviews with the elder Trump’s former employees and more than 100,000 pages of documents including tens of thousands of pages of confidential records, the Times unfolds the story of how Trump “received the equivalent today of at least $413m from his father’s real estate empire, starting when he was a toddler and continuing to this day”.
During his presidential campaign, Trump promoted himself as a self-made real estate mogul who started out with only a “very small” loan from his businessman father, Fred Trump. Little of the information had previously come to light. Its publication, which was subject to blanket denials by a lawyer for the president and by the White House but which was not refuted in detail, fundamentally alters the visible facts establishing the centerpoint of Trump’s identity: his wealth.
The Times said its findings were based on more than 200 tax returns from Fred Trump, his companies and various Trump partnerships and trusts. The records did not include Donald Trump’s personal tax returns. The investigation drew on Fred Trump’s tax documents but did not unearth the president’s personal tax filings, which Donald Trump has refused to disclose.
Trump lawyer Charles Harder told the Times: “President Trump had virtually no involvement whatsoever with these matters.” The story of a nine-figure inheritance contradicts Trump’s portrayal of himself, going back more than 40 years, as a self-made man. He has characterized his father’s real estate empire as a “tiny” concern and said he only ever took a $1m loan from his father, which he paid back with interest.
Harder added: “The affairs were handled by other Trump family members who were not experts themselves and therefore relied entirely upon the aforementioned licensed professionals to ensure full compliance with the law.” I got peanuts. My father didn’t leave a great fortune … I built this empire and I did it by myself
The White House did not immediately respond to a request for comment on the report. Reuters was not immediately able to verify the report. “I got peanuts,” Trump told one interviewer. “My father didn’t leave a great fortune. It was Brooklyn and Queens real estate. I built this empire and I did it by myself. Nobody did it for me.”
The newspaper said the report was based on interviews with Fred Trump’s former employees and advisers and more than 100,000 pages of documents describing the inner workings of his business empire. In fact, the Times reported, Trump was the beneficiary of “295 streams of revenue that Fred Trump created over five decades to enrich his son”. That largesse made Donald Trump a millionaire by the age of eight, the report says.
“The investigation also draws on tens of thousands of pages of confidential records –bank statements, financial audits, accounting ledgers, cash disbursement reports, invoices and canceled checks,” the Times said. Fred Trump was one of the most prolific real estate developers of his time, erecting apartment buildings and row houses in the outer boroughs of New York City – mostly Brooklyn and Queens – in the explosion of residential construction that followed the second world war. His harsh landlord practices were the subject of a protest song, Old Man Trump, by the folksinger Woody Guthrie, a longtime Brooklyn resident.
In defiance of the mountain of tax returns, incorporation and loan documents, press secretary Sarah Sanders released a statement Tuesday evening noting that Fred Trump “has been gone for nearly twenty years” and calling the Times report “misleading”. “Many decades ago the IRS reviewed and signed off on these transactions,” Sanders said.
But as damaging as the revelation of his massive inheritance might be to the myth Trump has carefully maintained, the documentation in the Times report of alleged tax fraud by Trump, which if true could still be subject to civil fines, might represent the greater hazard to the president.
In one dramatic example, the Times reported that Trump and his siblings paid only $52.2m in taxes on more than $1bn in wealth transferred to them by their parents. That is an approximately 5% tax payment at a time when gifts and inheritances were taxed at 55%. The alleged sleight-of-hand was achieved, the Times reports, by the systemic undervaluation of assets and properties.
A lawyer for Donald Trump, Charles Harder, denied that his client had a role in devising a tax strategy for his father’s inheritance and disputed the Times’ assertion that the president had committed tax fraud.
“Should The Times state or imply that President Trump participated in fraud, tax evasion or any other crime, it will be exposing itself to substantial liability and damages for defamation,” Harder said in a statement.
“The New York Times’s allegations of fraud and tax evasion are 100% false, and highly defamatory,” the lawyer continued. “There was no fraud or tax evasion by anyone. The facts upon which The Times bases its false allegations are extremely inaccurate.”
The Times investigation documents two dramatic moments in the chain of wealth passing from father to son. In 1997, Donald Trump and his siblings took ownership of their father’s empire, netting the current president tens of millions of dollars instantly, the Times reported.
Weeks earlier, Trump had published The Art of the Comeback, explaining how he had recovered after his casino interests collapsed.
“I learned a lot about myself during these hard times,” he wrote. “I learned about handling pressure. I was able to home in, buckle down, get back to the basics, and make things work. I worked much harder, I focused, and I got myself out of a box.”
What Trump’s book does not mention was the method by which he made a bond payment on a troubled casino in Atlantic City, New Jersey. His father, the Times reported, sent to the casino “a trusted bookkeeper” with a check for $3.35m. The emissary bought $3.35m in chips and left without placing a bet. The same day, Trump Sr wrote another check, for $150,000, to the casino in question.
“It was an illegal $3.5m loan under New Jersey gaming laws, resulting in a $65,000 civil penalty,” the Times notes.
Then, in 2003, Donald Trump told his siblings they should sell the assets that fed their respective fortunes: the pieces of their father’s empire. The deal closed in 2004 for $737.9m, the paper reported.
But the banks financing the purchase valued the empire on sale at nearly $1bn, according to the Times.
“In other words,” the report said, “Donald Trump, master dealmaker, sold his father’s empire for hundreds of millions less than it was worth.”
Donald TrumpDonald Trump
Real estateReal estate
US politicsUS politics
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