Art of the Steal: This is How Trump Lost $916M and Avoided Tax / David Cay Johnston
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Art of the Steal: This is How Trump Lost $916M and Avoided Tax
This is how Donald Trump’s accountants and lawyers most likely used the tax code to avoid paying income tax for almost two decades.
David Cay Johnston
10.03.16 11:41 AM ET
The big New York Times scoop that Donald Trump used $916 million of tax losses to enjoy many income tax-free years raised a question the newspaper didn’t try to answer: How did Trump do it?
Trump, the only major-party presidential nominee in four decades to keep all his tax returns secret, insists “there’s nothing to learn from them.”
Yet in one day I figured out how Trump’s advisers almost certainly arranged the massive tax losses, skipped out on a massive income-tax bill, and then fashioned a loophole with more valuable tax benefits than the already liberal tax breaks Congress gives big real-estate owners while sticking others with the bill.
Trump dumped the real costs of all this on investors who saw gold in his brand name, but who lost everything even as he was paid tens of millions of tax-free dollars.
All this came from subtle clues on the front pages of Trump’s 1995 Connecticut, New Jersey, and New York state income-tax returns. Which sums were on which lines in each state pointed to how Trump must have organized his affairs. Two of the most respected tax professors in America agree with my analysis. Edward Kleinbard of the University of Southern California and Martin J. McMahon Jr. of the University of Florida refined my view.
Trump’s gambit is easy to explain in plain English, but for tax wonks the short version is this: Trump combined tax benefits under Section 1231 of the Internal Revenue Code with the exception provisions in Section 108.
Goes on in link: http://www.thedailybeast.com/articles/2016/10/03/art-of-the-steal-this-is-how-trump-lost-916m-and-avoided-tax.html?via=desktop&source=twitter
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