More Questions Arise About Trump’s Love Of Not Paying Taxes As Lawsuit From Mexico Claims Slimy Business Practices
Just a week before the election, Donald Trump’s love of avoiding taxes is once again coming under scrutiny, as the reason he didn’t pay taxes for 18 years becomes clearer and a new lawsuit from Mexico highlights just how far Trump will go to rip people off.
To start with, Donald Trump is being hit by a massive tax fraud lawsuit from a Mexican citizen.
According to Bipartisan Report, Jaime Martínez Veloz, a former member of Mexico’s congress, is not too happy with how Trump did business in Mexico after his Trump Ocean Resort project went belly up.
“In his complaint, Martinez alleges that Trump and his partners…collected $32.5 million from customers before abandoning the project in 2009 due to the financial crash. Martinez alleges that Trump never paid any taxes on the $32.5 million.”
Of course, according to Trump, he had nothing to do with it all and just lent his name to the project which he said would be “the most spectacular place in all of Mexico.” That, of course, is BS.
The Hill reports that of the $32.5 million collected from customers, only $7.25 million had been returned, and that wasn’t from Trump, but from his two partners in the failed project. Where did the rest of the money go?
Now, back over to the United States side of the border and the reason Trump got out of paying US taxes for 18 frickin’ years.
From what tax experts can figure, seeing as Trump hasn’t actually released his returns, is that he used a “stock-for-debt swap” scheme that requires quite a bit of mathematical gymnastics to pull off as The New York Times reports.
“Say a company can repay only $60 million of a $100 million bank loan. If the bank forgives the remaining $40 million, the company faces a large tax bill because it will have to report that canceled $40 million debt as taxable income.”
Here is where the loophole, which has since been closed, comes in. A company would “swap stock for debt” making it “look as if the entire $100 million loan had been repaid, and presto: There would be no tax bill due for $40 million in canceled debt.” And to make things more interesting, the market value of the stock could actually be worth nothing.
“Even in the opaque, rarefied world of gaming impenetrable tax regulations, this particular maneuver was about as close as a company could get to waving a magic wand and making taxes disappear.”
Legal? Welllll, yes. But, as senior fellow at the Tax Policy Center, Steven M. Rosenthal, it’s pretty slimy.
“Whatever loophole existed was not ‘exploited’ here, but stretched beyond any recognition.”
Trump may have skirted tax laws to get out of what he owed https://t.co/OKi63meff2 pic.twitter.com/pm8iVUg27w
— ThinkProgress (@thinkprogress) November 1, 2016
All of this paints an even clearer picture of a man who is willing to do anything to avoid paying taxes. If only Trump would release his damn tax returns to clarify everything, he could maybe clear his name. But, what are the chances of that happening?