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Report: Trump Signed Off on Deal to Deprive US of Tens of Millions in Taxes

Image: Report: Trump Signed Off on Deal to Deprive US of Tens of Millions in Taxes
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By    |   Wednesday, 25 May 2016 11:25 AM

Donald Trump put his signature on a 2007 business deal that experts say was designed to avoid paying tens of millions in federal taxes, The Telegraph reported Wednesday.

According to The Telegraph, Trump signed off on a $50 million investment deal, which was rewritten later as a loan. By doing so, Trump and his partners avoided paying roughly $20 million in taxes, and court papers viewed by The Telegraph allege the deal amounted to fraud. 

The allegations surround Trump's business dealings with the Bayrock Group, the company building Trump SoHo.

Bayrock entered into a deal with FL Group, a company that had agreed to invest $50 million in Bayrock's partnerships, The Telegraph reported.

But investment meant a 40 percent tax rate on their gain; a loan meant no tax would be payable. A loan also meant Bayrock would avoid another estimated $80 million in taxes based on future profits from the real estate deal with FL Group, the Telegraph reported.

Trump lawyer Alan Garten told the Telegraph the real estate mogul "had nothing to do with that transaction."

"He was not signing off on the deal," Garten told The Telegraph.

However, documents viewed by The Telegraph show Trump's approval was necessary with Bayrock's investments; the paper reported Trump had a 15 percent stake in Trump SoHo.

The Telegraph showed the documents to independent experts to get their opinion.

"Converting the original equity into debt improved their tax position dramatically. … But they didn't really change the economics at all," Howard Abrams, professor of law and director of tax at the University of San Diego told The Telegraph.

"It's not a loan - it's really equity. I don't think they would survive a challenge [by the IRS]," Abrams added.

A former federal prosecutor in the Department of Justice's tax division told The Telegraph that if action were taken by the IRS, it could see Trump deposed in court.
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Politics
Donald Trump put his signature on a 2007 business deal that experts say was designed to avoid paying tens of millions in federal taxes, The Telegraph reported Wednesday.
Trump, Taxes, Fraud, business, Federal
339
2016-25-25
Wednesday, 25 May 2016 11:25 AM
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