New York Regulators Examine the Trump Family’s Tax Schemes

New York City officials said on Thursday that they had joined state regulators in examining whether President Trump and his family underpaid taxes on his father’s real estate empire over several decades.

The announcement came in response to an investigation published this week in The New York Times that showed how Mr. Trump had participated in dubious tax schemes during the 1990s, including instances of outright fraud, that greatly increased the fortune he received from his parents.

“We are now just starting to pore through the information,” said Dean Fuleihan, the city’s first deputy mayor.

One type of tax that the city will examine is the real estate transfer tax. Officials said the extremely low valuations the Trump family placed on buildings that passed from Fred C. Trump to his children through trusts could have resulted in underpaid transfer taxes.

The Times reported that through several aggressive and potentially illegal maneuvers, the Trumps claimed that 25 apartment complexes transferred to Donald Trump and his siblings from their father were worth just $41.4 million. The Trumps sold those buildings within a decade for more than 16 times that amount.

Mr. Fuleihan said the city would also explore whether another tax avoidance maneuver by Mr. Trump and his siblings resulted in Fred Trump’s empire underpaying property taxes.

That maneuver involved a company, created by the Trump family in 1992, called All County Building Supply & Maintenance. All County existed largely on paper, The Times found. Its work, such as it was, consisted of adding 20 percent or more to the cost of goods and services bought by Fred Trump. The padded amount was split between Donald Trump and his siblings, essentially a gift from their father that avoided the 55 percent gift tax at the time.

Mr. Fuleihan said the scheme as described by The Times would have artificially driven down the profitability of Fred Trump’s buildings. And because city property taxes on rental buildings are based in part on profits reported by owners, All County would have had the effect of lowering the property tax burden.

Mr. Fuleihan said city and state agencies are cooperating on the effort. The State Department of Taxation and Finance announced on Wednesday that it was “pursuing all appropriate avenues of investigation.”

Another state agency is looking into whether tenants in Fred Trump’s rent-regulated apartments saw their rents unduly increased because the Trumps used the padded All County invoices to apply for rent increases, as The Times found. State regulations allow owners of rent-regulated buildings to apply for increases to recover the “actual and verified cost” of some improvements to buildings, said Freeman Klopott, a spokesman for the State Division of Housing and Community Renewal.

The agency can refer cases of landlords found to be submitting false receipts to the state attorney general.

A growing number of Democrats in Congress, meanwhile, cited the article in renewing their longstanding demands for Mr. Trump to release his income tax returns, something he has steadfastly declined to do, breaking with four decades of practice by previous presidents.

And Ron Wyden, a Democratic senator from Oregon and the ranking member of the Finance Committee, asked the I.R.S. on Wednesday to open an investigation into The Times’s findings. “It is imperative that I.R.S. fully investigate these allegations and prosecute any violations to the fullest extent of the law,” Mr. Wyden said in a statement.

A spokesman for the I.R.S. said the agency would not comment on whether it was taking any action in response to The Times’s investigation.

Some of the Trumps’ tax evasion maneuvers uncovered by The Times warranted investigation as potential crimes, former prosecutors said, but the statute of limitations on any such charges has long since expired.

The inquiries will explore whether civil penalties and bills for back taxes are warranted. City officials said interest and penalties of up to 25 percent could be added to any unpaid taxes.

Source link

more recommended stories

  • Trump’s Targeting of Intelligence Agencies Gains a Harder Edge

    They accelerated in July when the.

  • ‘Wow, What Is That?’ Navy Pilots Report Unexplained Flying Objects

    WASHINGTON — The strange objects, one.

  • Sarah Sanders Says Trump and Kim ‘Agree in Their Assessment’ of Biden

    President Trump and the North Korean.

  • Trump’s Ringside Evening in the Sumo Arena

    TOKYO — As the leader of.

  • How Democrats Are, and Aren’t, Challenging the Trump Economic Record

    NASHUA, N.H. — Ask Democratic candidates.

  • The Insults Trump Has Hurled at 2020 Democrats

    Joseph R. Biden Jr. is “sleepy,”.

  • Trump Opens Tokyo Visit With a Tweet Sure to Unnerve the Japanese

    TOKYO — President Trump kicked off.

  • Bernie Sanders, No Longer the Front-Runner, Brings Campaign Home to Vermont

    MONTPELIER, Vt. — Senator Bernie Sanders.

  • Fact-Checking Bernie Sanders on the Campaign Trail

    “Absolutely. In fact, climate change is.

  • A Lesson of Sandy Hook: ‘Err on the Side of the Victims’

    NEWTOWN, Conn. — Scarlett Lewis sees.

  • Iran Slams U.S. After Middle East Troop Buildup Is Announced

    LONDON — Iranian officials lashed out.

  • John Bolton Says North Korean Missile Tests Violated U.N. Resolutions

    TOKYO — North Korean weapons tests.

  • On Politics: The Biggest Stories of the Week

    • China’s Supply of Minerals for.

  • Supreme Court Blocks Two Rulings Striking Down Voting Maps

    WASHINGTON — The Supreme Court on.

  • Barr Got More Power to Review the Russia Inquiry. Here’s What We Know About Its Origins.

    WASHINGTON — President Trump has given.

  • Edited Pelosi Video vs. the Original: A Side-by-Side Comparison – Video

    Channels & Shows Home Search U.S..

  • Jay Inslee Is Running on Climate Change. The Issue Is Catching On, So Why Isn’t He?

    RAYMOND, N.H. — For years, climate.

  • News Quiz: Test Your Knowledge of the Week’s Headlines

    Did you stay up to date.

  • On Politics: The Trade War Is Here to Stay

    Good Friday morning. Here are some.

  • Hope Hicks Left the White House. Now She Must Decide Whether to Talk to Congress.

    A White House spokesman did not.

  • 2020 Democrats Join McDonald’s Workers Striking Over Wages and Harassment

    As McDonald’s held its annual shareholder.

  • Sanders’s Education Plan Renews Debate Over Charter Schools and Segregation

    When Senator Bernie Sanders delivered a.

  • Trump Administration to Announce Farm Aid to Ease Pain of Trade War

    He reached out to Canadian and.

  • Pentagon to Build Temporary Shelter for 7,500 Migrant Adults Facing Deportation

    WASHINGTON — The Pentagon said on.

  • On Politics: Trump Blows Up Meeting With Democrats

    • New York State lawmakers approved.

  • U.S. Yet to Find Evidence of New Chemical Weapons Attack in Syria

    WASHINGTON — The United States has.

  • Michael Avenatti Is Charged With Stealing Nearly $300,000 From Stormy Daniels

    Federal prosecutors on Wednesday charged the.

  • Trump’s Battles: Today’s State of Play

    congress and the presidency As Democrats.

  • Gillibrand Proposes Huge Investments in Maternal Health, Child Care and Education

    Senator Kirsten Gillibrand’s presidential campaign on.

  • On Politics: Trump May Impose Limits on Chinese Maker of Surveillance Tech

    Good Wednesday morning. Here are some.

  • Anita Hill Worries Female 2020 Candidates Are ‘Not Being Taken Seriously’

    Mr. Biden spoke with Ms. Hill.

  • U.S. Says Syria’s President May Be Using Chemical Weapons Again

    WASHINGTON — The State Department said.