Since I didn't get around to this until 12:30 this morning and it's a long column short on specifics, I believe a general fisking is required to dismiss this as the shit that it is. Away we go![NYT] - President Trump participated in dubious tax schemes during the 1990s, including instances of outright fraud, that greatly increased the fortune he received from his parents, an investigation by The New York Times has found.
First off, a 'dubious tax scheme' is not an instance of fraud. I have mentioned this many, many times in previous posts - you either comply with the tax law, or you don't comply with the tax law. The use of 'dubious tax scheme' is designed to convey the impression that what Trump did is illegal. It is not; to be expanded on throughout the article. Worth mentioning that the periods discussed are well past the general three-year statute of limitations.
Mr. Trump won the presidency proclaiming himself a self-made billionaire, and he has long insisted that his father, the legendary New York City builder Fred C. Trump, provided almost no financial help.
But The Times’s investigation, based on a vast trove of confidential tax returns and financial records,
| Golly. How did they get those, and what will President Trump do about the unethical behaviour of the party of the second part? |
Note the technique of inflating actual past-value dollars to arrive at larger current dollars; this is done quite a few times in the article.
Much of this money came to Mr. Trump because he helped his parents dodge taxes. He and his siblings set up a sham corporation to disguise millions of dollars in gifts from their parents, records and interviews show.
| When he was a toddler? Clever lad! |
A synonym for 'dodge' is 'avoid'. Again, there is nothing wrong with avoiding taxes - this is what I do for a living when I prepare tax returns for my clients. Conveniently not mentioned as well - how many audits did Trump's father endure?
These maneuvers met with little resistance from the Internal Revenue Service, The Times found.
I have also mentioned, albeit on a less frequent basis, that the IRS loves auditing rich individuals and that IRS audit teams practically live at the headquarters of large companies like IBM, GE, Microsoft, Caterpillar, etc., not to mention state and local audit groups. I am beyond certain that Trump has been audited multiple time by multiple tax jurisdictions over his lifetime. This is the ultimate test about Trump's compliance with the tax laws, and the only ones that matter. The misleading phrase 'met with little resistance' can be translated to 'Trump passed these tests with minor compliance errors'.
The president’s parents, Fred and Mary Trump, transferred well over $1 billion in wealth to their children, which could have produced a tax bill of at least $550 million under the 55 percent tax rate then imposed on gifts and inheritances.
The Trumps paid a total of $52.2 million, or about 5 percent, tax records show.
See the above discussion about 'dodge taxes' and 'tax avoidance'; this is more of the same.
Mr. Harder sought to distance Mr. Trump from the tax strategies used by his family, saying the president had delegated those tasks to relatives and tax professionals. "President Trump had virtually no involvement whatsoever with these matters," he said. "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."
How many of you hire a tax preparer for your Federal & state tax returns every year? I bet it's at least half of you, yet the tone of this article clearly expects Trump to do his own taxes, which is absurd. I've seen a few partnership tax returns run $14,000 in tax prep. fees, and that business operation is nowhere as complex as Trump's businesses are, or the aforementioned Dow / S & P 500 companies.
The Times’s findings raise new questions about Mr. Trump’s refusal to release his income tax returns, breaking with decades of practice by past presidents. According to tax experts, it is unlikely that Mr. Trump would be vulnerable to criminal prosecution for helping his parents evade taxes, because the acts happened too long ago and are past the statute of limitations. There is no time limit, however, on civil fines for tax fraud.
Again, as backed up by the 'tax experts' - 'evade’ is a synonym for 'avoid’ and is perfectly legal, and also contradicts earlier assertions in the article that Trump did something illegal.
While the records do not include the president’s personal tax returns and reveal little about his recent business dealings at home and abroad, dozens of corporate, partnership and trust tax returns offer the first public accounting of the income he received for decades from various family enterprises.
Let's also note the one key tax return type being left out - gift tax returns. I will skip over the next ten or so paragraphs that is nothing more than class warfare and envy and begrudgingly admit (again) that tax avoidance is legal. Some paragraphs above, the article states that the actual gift tax bill is less then what they conclude could have resulted in a much larger tax bill. Something may have been left on the cutting room floor, or maybe they're just throwing numbers around - I'll go with the latter.
The manipulation of values to evade taxes was central to one of the most important financial events in Donald Trump’s life. In an episode never before revealed, Mr. Trump and his siblings gained ownership of most of their father’s empire on Nov. 22, 1997, a year and a half before Fred Trump’s death. Critical to the complex transaction was the value put on the real estate. The lower its value, the lower the gift taxes. The Trumps dodged hundreds of millions in gift taxes by submitting tax returns that grossly undervalued the properties, claiming they were worth just $41.4 million.
How would you know that if you've never looked at any of the gift tax returns? Do you have records of the fair market values on his properties and compare them with the stated value(s) on any of the returns in question? Of the tax return types mentioned, this one (gift tax) is omitted. Again, how did this get past the prying eyes of Federal and NY state tax auditors? Curious, isn't it?
By now I'm getting bored with this repetitive article - let's cut to the fun stuff, the one 'instance' of fraud where the article promised you, dear reader, multiple 'instances of fraud':
The most overt fraud was All County Building Supply & Maintenance, a company formed by the Trump family in 1992. All County’s ostensible purpose was to be the purchasing agent for Fred Trump’s buildings, buying everything from boilers to cleaning supplies. It did no such thing, records and interviews show. Instead All County siphoned millions of dollars from Fred Trump’s empire by simply marking up purchases already made by his employees. Those millions, effectively untaxed gifts, then flowed to All County’s owners ‐ Donald Trump, his siblings and a cousin. Fred Trump then used the padded All County receipts to justify bigger rent increases for thousands of tenants.
In a word, this is horseshit. Name me a company that doesn't mark up its prices in one way or the other. This is done in part to cover operating costs such as employee salaries, rent on storage and other buildings, transportation costs and other costs. That paragraph is pure assertion couched in the language of class warfare and criminal insinuation- 'siphoned off', 'effectively untaxed gifts', and the like. Also note that the NYT does not assert that any tax filings with respect to this company are 'fraudulent' or whatever - because this company involved the sale of tangible personal property, you can bet that NY Dept. of Taxation & Finance audit staff were crawling over this company doing sales & use tax audits.
All in all, an extremely underwhelming column where the two principals, Fred Trump and Donald Trump, are President of the United States and deceased, neatly packaged so as to avoid a libel suit by not mentioning other Trump family members multiple times or in a libelous manner. Better luck next time, New York Times.