Former President Donald Trump could owe more than $100 million in taxes as a result of a yearslong Internal Revenue Service inquiry into claims of huge losses on his Chicago skyscraper, The New York Times and ProPublica reported Saturday.
The news organizations reported Trump claimed massive financial losses twice — first on his 2008 tax return, when he said the building, then mired in debt, was “worthless,” and again after 2010, when he had shifted its ownership into a new partnership also controlled by Trump.
The 2008 claim resulted in Trump reporting losses as high as $651 million for the year, and there is no indication it drew an IRS challenge, the outlets reported. Then, Trump’s lawyers enabled further claims of losses in 2010 by shifting the Chicago tower into another partnership, “DJT Holdings LLC,” The Times and ProPublica reported.
In the years that followed, other Trump businesses, including golf courses, would be shifted into that same partnership — which his lawyers used as the basis to claim more tax-reducing losses from the Chicago tower. That move sparked the IRS inquiry. Those losses added up to $168 million over the next decade, the report said.
The outlets calculated the revision sought by the IRS could result in a tax bill of more than $100 million.
The only public mention of the IRS audit into Trump’s Chicago tower loss claims came in a December 2022 congressional report that The Times and ProPublica reported made an unexplained reference to the section of tax law at issue in the case. That mention, the outlets reported, confirmed the audit was still underway.
“This matter was settled years ago, only to be brought back to life once my father ran for office. We are confident in our position, which is supported by opinion letters from various tax experts, including the former general counsel of the IRS,” Trump’s son Eric Trump, the executive vice president of the Trump Organization, told The Times and ProPublica in a statement.
Fact check: Trump falsely claims he isn’t allowed to appeal fraud ruling until he puts up big money
Donald Trump’s legal team and the New York Attorney General’s office are working hard ahead of the former president’s Monday’s deadline to secure a bond for the multimillion-dollar civil fraud judgment against him.
Trump personally owes over $454 million stemming from the ruling made by Judge Arthur Engoron back in February. The figure balloons up to $463.9 million when including the money owed from his sons, Eric and Donald Jr., the Trump Organization and the interest that was accrued as of the date of the ruling.
Experts who spoke to CNN say Attorney General Letitia James and her staff should be poised to start the complicated legal maze of seizing Trump’s assets if the former president does not secure the bonds needed to cover Engoron’s ruling as he appeals.
Assets, such as buildings, houses, cars, helicopters and his plane, are in play. The main focus could be on his bank accounts, which experts say will be easier to take hold of, and properties, which would be more difficult.
Trump has asked a state appeals court to allow him to post a smaller bond – or none at all – claiming he would face irreparable harm if he were forced to sell properties at a fire sale that can’t be undone if he ultimately wins his appeal. The court has not yet ruled.
Here’s what happens if Trump can’t secure the bond:
Seizing bank accounts and cash
In theory, officials can begin the complicated legal process of taking his assets, barring any other strategic legal maneuvering from state prosecutors and countering from Trump’s legal team. Officials will have to weigh what assets they want to take, whether it’s his bank accounts or his properties. Experts think the first action should be seizing his bank accounts.
“The banks are the easiest part, they’ll receive the judgment from the Attorney General – the court order – then the banks will enforce,” said attorney Peter Katz, a former federal prosecutor at the Eastern District of New York who has handled fraud cases. “They take the funds from the account and put it in the attorney general’s accounts. The other stuff is a little more challenging.”
Taking money from Trump’s accounts requires state prosecutors to ask the New York City Sheriff or a US Marshall to go into the main branch of whichever bank Trump has his money, armed with a court order.
“They walk in and give it to the manager,” said Adam Pollock, a former assistant New York State Attorney General who now specializes in judgment enforcement at Pollock Cohen LLP. “The manager is supposed to pay over the amount forthwith. It should be a cashier’s check.”
Any perceived extra time taken by the attorney general’s office could be just part of determining the right strategy.
“They’re trying to get their ducks in a row. They want to find the most liquid of the assets they can restrain immediately. A bank account is the most effective way to do it,” said attorney Alden B. Smith who specializes in debt collection. “They’re probably just deciding what’s the best course of action.”
What about buildings and businesses?
Seizing property takes much longer.
Once state prosecutors figure out what property they want to take, they give the sheriff’s office the execution order, along with a fee for $350, Pollock said. The sheriff then posts the notice for the property in three places and the Attorney General’s office must advertise it four times, Pollock said. Then, in 63 days from when the execution order is given to the sheriff, a public auction is held for the property, according to Pollock.
“They could say ‘hand over the ownership of these 500 corporations and LLC’s to the sheriff for public auction’ or just enough so that they could satisfy the judgment or $455 million worth,” Pollock said.
The seizure process will be more difficult with Trump’s out-of-state properties, so state prosecutors have already made some legal moves to get the ball rolling in New York.
The attorney general’s office filed judgments in Westchester County, north of New York City, in what some say is the first sign that the state is laying the groundwork to seize the former president’s golf course in Briarcliff Manor as well as his private estate known as Seven Springs.
State lawyers entered the judgments with the clerk’s office in Westchester County on March 6, just one week after Engoron’s ruling.
What about Mar-a-Lago?
No other judgments have been filed, but the process could play out in other states where Trump has assets, most notably Mar-a-Lago in Florida, though other properties might be less challenging to take.
“The attorney general’s office is the largest firm in New York State, if you think about it as a law firm. The office has zero lawyers in Florida. I would see execution on properties in New York before you see anything in Florida, Pollock said.
A key legal battle could be how much of Mar-a-Lago is considered to be Trump’s home, which could be protected under the law.
“At the heart could be the homestead extension. But that would have to play out in court,” Pollock said.
Can Trump get out of this?
Trump is still waiting on whether an appeals court will either lessen the amount he must pay as part of the ruling or pause the judgment all together while his appeal is being considered.
If he doesn’t win his appeal, bankruptcy remains an option, albeit one the former president does not want to take.
“You don’t want him to file bankruptcy, then the debt will be discharged,” Smith said. “If he files for bankruptcy then the judgment is automatically stayed. Bankruptcy is the biggest nemesis of collection enforcement for lawyers.”
If Trump doesn’t come up with the money, his options shrink considerably.
“I don’t see any other way he could stop the process from proceeding without going into bankruptcy or getting a bond,” Smith said.
Trump and his team could sell smaller properties as a way to try and satisfy the debt.
“At the end of the day, he’ll do anything before letting Tish James put on a metaphorical padlock on 40 Wall Street,” Harry Litman, a former deputy assistant attorney general, told CNN on Friday.
While the clock is about to run out, some experts question why a grace period was even given.
“There’s no reason for courtesy when he owes $455 million dollars to the people of the state of New York after being found persistently liable for fraud,” Pollock said. “That’s not someone you typically extend courtesy to.”
Does Trump have the cash?
The former president posted on Truth Social Friday he currently has almost $500 million in cash that he intended to use for his campaign and said James “wants to take it away from him.”
“THROUGH HARD WORK, TALENT, AND LUCK, I CURRENTLY HAVE ALMOST FIVE HUNDRED MILLION DOLLARS IN CASH, A SUBSTANTIAL AMOUNT OF WHICH I INTENDED TO USE IN MY CAMPAIGN FOR PRESIDENT. THE OFTEN OVERTURNED POLITICAL HACK JUDGE ON THE RIGGED AND CORRUPT A.G. CASE, WHERE I HAVE DONE NOTHING WRONG, KNEW THIS, WANTED TO TAKE IT AWAY FROM ME,” Trump posted in all caps.
His attorney, Chris Kise told CNN that Trump wasn’t referring to cash he has on hand, however.
“What he’s talking about is the money reported on his campaign disclosure forms that he’s built up through years of owning and managing successful businesses,” Kise told CNN on Friday. That is the very cash that Letitia James and the Democrats are targeting.”
Trump also recently had to secure a nearly $92 million bond to satisfy the judgment against him in the E. Jean Carroll defamation case as he appeals.
Litman told CNN that there is likely less money than Trump says because of the fraud ruling. Either way, he added, is a devastating blow for the former president.
“It’s like a company that all of a sudden has no chairs, furniture, accounts receivable or anything. That is really the end of the day, I think, for the Trump organization in New York,” Litman said. “It’s an ugly, ugly situation for him, even if it is halfway accurate.”
Opinion: Trump’s image is on the line
In Charles Dickens’ 1850 novel “David Copperfield,” the perpetually indebted Mr. Micawber notes that all he can offer his young lodger is this advice: “Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness.”
By contrast, “Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.”
In that case, “the blossom is blighted, the leaf is withered,” Micawber says, “and in short you are forever floored.” Like Dickens’ own father who gave him the same advice in real life,Micawber is dragged off to debtors’ prison, but he never loses his optimism that “something will turn up.”
Something may turn up for formerPresident Donald Trump. He faces a Monday deadline to post a $464 million bond that would prevent New York Attorney General Letitia James from attempting to seize his assets while he appeals the judgment imposed on him, his sons and his companies in the civil fraud case.
Trump can hope that he’ll succeed in an appeal to reduce the size of the bond, or that somehow the $3 billion he may reap from a public offering of his Truth Social platform can improve his situation, even though his stake is locked up for six months. And, in a post on Truth Social, he boasted of having nearly half a billion in ready cash to put to work in his presidential campaign, while his lawyers insist he can’t post the bond.
Debtors’ prisons are a thing of the past, but the cold hard reality of finance isn’t — if your cash going out exceeds what’s coming in, you have to borrow money, or sell something.
Money has always been integral to the Trump brand, starting decades before he played a billionaire on “The Apprentice.” Trump’s 1987 bestseller “The Art of the Deal”, written with Tony Schwartz, begins, “I don’t do it for the money. I’ve got enough, much more than I’ll ever need. … Deals are my art form.”
Having a lot of money distinguished him from other presidential candidates, Trump contended. “Boasting, as he always has, of being fabulously rich, he told the 2016 voters that his campaign, unlike that of his rival, was completely self-funded,” Frida Ghitis wrote. “That wasn’t true, of course, but his argument was actually correct. Nobody would control him, he claimed, because those who give you money expect something in return. ‘I don’t need anybody’s money,’ Trump said in his June 2015 presidential campaign announcement.”
“Now Trump needs money, a lot of it. What would his creditors or benefactors want in return?…
“In addition to nearly half a billion dollars in judgments, Trump faces massive legal fees over multiple civil and criminal cases, and his presidential campaign funds, drained after funding his personal legal costs, are badly lagging behind President Joe Biden’s massive war chest.”
As Julian Zelizer noted, “The problem for Trump is that as his legal expenses and obligations are piling up, his fundraising efforts have been lagging. His leadership political action committee, Save America, spent nearly $5.6 million in legal fees in February alone. And while the super PAC Maga Inc. has refunded nearly all of that money, that’s money that could have been used for Trump’s campaign.”
“It doesn’t help that there is a growing fundraising gap between Trump and Biden. Right now, President Biden’s campaign coffers are overflowing. … In a campaign where a relatively small percentage of swing voters in a handful of states will likely determine the outcome, turnout and advertising buys will have an outsized impact. Biden’s financial strength has allowed his campaign to unleash a torrent of blistering ads in swing states, targeting core voters such as Latinos.”
Trump faces trial in a New York courtroom next month over a $130,000 “hush money” payment to adult film actress Stormy Daniels before the 2016 election. In a new documentary on Peacock, Ana Marie Cox wrote, Daniels tells her story. Raised by her mother in Baton Rouge, Louisiana, “shebegan her career as a stripper at the age of 17, acted in her first adult film in 2002 and soon branched into writing and directing. In July 2006, she met Trump at a celebrity golf tournament and says that the two had sex that weekend. Trump has denied being sexually involved with Daniels…”
“As an adult filmmaker, Daniels probably understands objectification better than most and she’s used every tool at her disposal to move from object to subject in this scenario. This is a story about her, and not what Trump did to her. Daniels’ greatest contribution to the movement against Trump is her commitment to her own humanity. In the face of dehumanization, staying true to ourselves is the most powerful statement in the world.”
Trump’s former trade adviser, Peter Navarro, began a four-month prison sentence last week for contempt of Congress. He’s not the first Trump associate to go behind bars, SE Cupp pointed out. “Indeed, working for Donald Trump seems to come with some serious personal and professional liability – expect to lawyer up, expect to have to lie for him, expect to have to cover his tracks,” she said.
After months of negotiations and intraparty squabbles, Speaker Mike Johnson did last week what his predecessor, Kevin McCarthy did when he was nominally in charge of the House Republicans — rely on votes from Democrats to pass spending bills. Following in Rep. Matt Gaetz’ footsteps, Rep. Marjorie Taylor Greene filed a motion to oust Johnson, though it’s unclear if it will come to a vote.
Terror attack in Russia
ISIS claimed responsibility for a terror attack at a Moscow-area concert venue, killing at least 133 people. If ISIS was indeed behind the attack, it would represent another sign of the group’s return from oblivion, after losing its “caliphate” in Iraq and Syria and devolving into a loosely allied group of affiliates, Peter Bergen wrote.
“ISIS-K certainly has the capability and motive to attack Russia. When it comes to motive, the Russian support for the Syrian dictator Bashar al-Assad, which helped him remain in power during the Syrian civil war, certainly comes to mind. For ISIS, Assad is a mortal enemy, both because he is a member of a Shia sect and because he has systematically killed Sunnis in Syria.
“Also, historically, Russia has brutally repressed Muslim minorities like the Chechens. As for capability, the ISIS-K attack in Iran earlier this year demonstrated that the group could carry out a large-scale attack outside of its home base in Afghanistan.” Bergen noted that Russian President Vladimir Putin publicly castigated the US for its warning on March 7 of extremists having “imminent plans to target large gatherings in Moscow.”
How Boeing lost its way
Boeing, one of the two major passenger aircraft makers in the world, is struggling to right itself. “The situation at Boeing is grim,” wrote aviation consultant Richard Aboulafia. “Serious program execution problems and high-profile safety incidents, with still-fresh memories of the two 737 MAX disasters in 2018 and 2019, are damaging the company’s brand and bringing increased regulatory scrutiny. Its recovery won’t begin until management starts examining how the company got here.”
“Years ago, an excessive focus on financial returns led Boeing to badly neglect two of its greatest resources: its people and its suppliers,” he noted.
While shareholders and senior executives benefited from stock dividends, buybacks and stock-based compensation, “the result of this strategy is plain to see: an under-resourced supply chain, and an equally under-resourced and badly alienated workforce. These have resulted in missed production targets, serious program delays, failed safety audits and embarrassing instances of shoddy workmanship…”
“All is not lost. Boeing still has good people, impressive technologies and great jetliners. The latter are in a duopoly with very high entry barriers, even if Airbus is quickly gaining market share. All that’s needed is a new approach to management at the top.”
A sign of the times
Another major American business, Joann Fabrics and Crafts, filed for bankruptcy last week. Lynda Gorov, descended from a family of Russian-Ukrainian tailors, said the outcome may have been inevitable given shifts in our society, but it’s still a shame. Joann, “founded 81 years ago when my seamstress grandmothers still had young children at home, blamed a post-pandemic sales slump for the downturn. The lockdown saw sales of sewing machines soar and stock sell out. But now that we’re not making our own face masks, or working from home in nearly the same numbers, many of our DIY urges are apparently on the wane.”
“But it’s more than that. … crafting skills used to be commonplace. Parents passed them down and when Silent Generation or early Boomer parents could not or did not, home economics teachers did. Most people (OK, most women) who attended public junior high schools in the 1960s, 1970s or even 1980s learned at least basic sewing skills and could advance them with elective classes in high school. Boys were welcome to attend, too, although I don’t recall any wearing aprons or thimbles alongside me.”
With the rise of fast fashion, “it can be far cheaper and far, far less time consuming to run to the mall and grab something off the rack for yourself or your child than it is to set up the sewing machine and do it yourself. Add up the hours spent knitting a scarf or crocheting a sweater, never mind the cost of materials, and homemade items have become the luxuries and store-bought ones the bargain. Most people I know don’t even mend anymore (and shame on us).”
Kate Middleton’s diagnosis
Catherine, the Princess of Wales, revealed Friday that she has been diagnosed with cancer, ending months of public speculation about her medical condition.
“I felt a deep and traumatic solidarity,” wrote Sara Stewart, a cancer survivor. “Recovering from major abdominal surgery — as Kate has been since January — is ghastly, and having to do it so you can be healthy enough for chemotherapy is a humbling one-two punch from the universe. For Kate, that’s topped off by having to endure it all while the entire world chases you down like a fox on one of those hunts the royals are always throwing…”
“Although I cannot stress enough that she owes absolutely nothing to the public while she goes through treatment, my fervent hope is that once she’s on the other side of it she’ll become a powerful voice advocating for more ways of early testing and destigmatization.”
Texas law
For a few hours last week, Texas was able to control its own immigration policy, despite more than a century in which the federal government has had sole authority to regulate America’s borders. After the US Supreme Court cleared the way for a controversial Texas law go into effect, a three-judge appeals court panel put the law on hold while it faces a challenge from the Biden administration.
“Whatever the Fifth Circuit and Supreme Court decide next, the question for President Joe Biden is what to do now,” wrote Lawrence Downes.
“Biden is the one who has been vilified for not stopping what (Texas Gov. Greg) Abbott, former President Donald Trump and others falsely call an immigrant ‘invasion.’ Despite his low approval rating on the issue, Biden remains the one who is actually responsible for immigration policy while demagogues like Abbott and Trump denigrate immigrants with violent and dehumanizing language and whip themselves and the public into a nativist frenzy.”
“If Texas is going to act this way,” Downes added, “Biden should step up and surge resources to the border — not more troops, but Department of Justice investigators and civil-rights lawyers, to be ready to defend immigrants and brown-skinned Texans (and Arizonans and New Mexicans passing through) against the profiling and other civil-rights violations that are sure to follow in SB 4’s wake. He should do more to protect asylum seekers at the southern border, who deserve safety and due process.”
Gaza
At a Harvard event last month, Trump’s son-in-law and former senior adviser Jared Kushner remarked that Gaza could have “very valuable” waterfront property and suggested that the people sheltering in the Southern city of Rafah, estimated at 1.4 million, could be moved into Egypt or into Israel’s Negev desert.
“Kushner’s notions are fantasies,” wrote Peter Bergen, “since the Egyptians are not going to accept substantial numbers of Palestinian refugees, let alone the more than one million sheltering in Rafah, something they have made clear repeatedly. Nor is Israel going to accommodate them.”
“The October 7th attacks by Hamas on Israel were inexcusable, and Israel had every right to avenge them,” Bergen noted.
“Still, Palestinian rage has been building for years, and Kushner, as then-President Donald Trump’s shadow secretary of state, helped contribute to this, something Kushner seems to be blissfully unaware of.”
Writing from Rafah, journalist Aseel Mousa observed, “After narrowly escaping death in Gaza City and Al-Maghazi, I’m unsure if I’ll survive in Rafah. If we are to avoid total catastrophe, Biden and the international community must act immediately to prevent a full-scale Israeli invasion of Rafah and to allow desperately needed humanitarian aid to enter.”
6% no more?
By settling a lawsuit, the National Association of Realtors has effectively conceded that the 5-6% commission that agents get from home sellers is no longer sacrosanct. But as sociologist Max Besbris pointed out, that doesn’t mean those rates, which are considerably higher than in many other countries, will go down quickly.
“It is clear that more consumer knowledge and more oversight are both necessary,” Besbris wrote. “It should become standard that agents both in writing and verbally alert new clients that fees are legally negotiable. We need stronger and more expansive training for licensed real estate agents, particularly around their financial and fair-housing obligations, as well as more data collection on real estate agent practices.”
AI unites the world
In a divided world, it’s noteworthy when the 193 member states in the United Nations General Assembly can agree on anything. As US Ambassador to the UN Linda Thomas-Greenfield wrote, the assembly adopted a US-backed resolution Thursday to create a global approach to living with AI.
“The resolution passed Thursday provides a framework to address challenges head on, with a focus on capacity-building to ensure equitable access to the benefits of AI, and equitable cover from its harms. It lays out the steps countries can take to ensure responsible governance, and protect all individuals — including vulnerable individuals — from discrimination, as well as the ways in which the United Nations itself can use AI to advance human rights and sustainable development.”
“Now comes the hard work of putting those principles not only to paper, but into practice.” Sixty five years ago, Thomas-Greenfield noted, former first lady Eleanor Roosevelt was shown a machine that could play checkers. She “asked ‘coming generations’ to consider what makes us human, and what it means to interact with new and powerful technology. Today, as we celebrate a milestone in realizing the potential of artificial intelligence, it is not on ‘coming generations,’ but this generation, to continue answering her call — together.”
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