Donald Trump could owe over USD 100 million in taxes if he loses audit case: Report
May 12, 2024
Washington DC [US], May 12 : Former US President Donald Trump could owe more than USD 100 million in taxes if he loses years-long Internal Revenue Service (IRS) inquiry into his claims of huge losses on his Chicago skyscraper, the New York Times reported.
According to an Internal Revenue Service inquiry uncovered by The New York Times and ProPublica, Trump used a "dubious accounting maneuver" to claim improper tax breaks from his troubled Chicago tower.
The 92-storey, glass-sheathed skyscraper along the Chicago River is the tallest and, the last major construction project by Trump.
But when Trump sought to reap tax benefits from his losses, the IRS. has argued, he went too far and, in effect, wrote off the same losses twice.
The first write-off came on Trump's tax return for 2008. With sales lagging far behind projections, he claimed that his investment in the condo-hotel tower met the tax code definition of "worthless," because his debt on the project meant he would never see a profit.
That move resulted in Trump reporting losses as high as USD 651 million for the year, the report stated.
But in 2010, Trump and his tax advisers sought to extract further benefits from the Chicago project, executing a manoeuvre that would draw years of inquiry from the IRS. First, he shifted the company that owned the tower into a new partnership. Then, he used the shift as justification to declare USD 168 million in additional losses over the next decade.
Trump's tax records have been a matter of intense speculation since the 2016 presidential campaign, when he defied decades of precedent and refused to release his returns, citing a long-running audit, according to the New York Times.
The outcome of Trump's dispute could set a precedent for wealthy people seeking tax benefits from the laws governing partnerships.
The audit represents yet another potential financial threat for Trump, the Republicans 2024 presidential nominee.
In recent months, he has been ordered to pay USD 83.3 million in a defamation case and another USD 454 million in a civil fraud case brought by the New York attorney general, Letitia James. However, Trump has appealed both judgements.
He is also in the midst of a criminal trial in Manhattan, where he is accused of covering up a hush-money payment to a porn star in the weeks before the 2016 election, the New York Times reported.
