Donald Trump paid no personal income taxes for 18 years by deducting the $916,000,000 he lost in 1995, reported the New York Times in a story based on leaked information from state tax returns. To do this Mr. Trump had to forgo the depreciation deductions on his properties, which included his Atlantic City casinos. Donald Trump formed a public corporation and funded his casinos with securities he sold to ordinary investors impressed with his celebrity and a promise of 14 percent interest who were unaware of the tax burden The Donald had imposed on the properties by taking personal deductions on them. As the company collapsed and the bond value plummeted 70 percent, the CEO paid himself a $5 million bonus and bought a private jet. So much for Mr. Trump’s sense of “fiduciary duty.”
As Drew Harwell explained in the Washington Post:
“Many of those who lost money were Main Street shareholders who believed in the Trump brand, such as Sebastian Pignatello, a retired private investor in Queens. By the time of the 2004 bankruptcy, Pignatello’s 150,000 shares were worth pennies on the dollar.
‘He had been pillaging the company all along,’ said Pignatello, who joined shareholders in a lawsuit against Trump that has since been settled. ‘Even his business allies, they were all fair game. He has no qualms about screwing anybody. That’s what he does.’”
Mr. Trump keeps saying that he made money in Atlantic City despite the real estate crash, but he got into the casino business during the 1980s and 1990s, and the crash was in 2007. He really made that money by transferring his huge business debts to his mom-and-pop shareholders, the local small businesses he stiffed, the employees he laid off, and the working Americans whose taxes had to fill the huge void he created.
“Trump’s reaction to the tax bombshell is worse than the story itself,” Matthew Yglesias , Vox
“Trump’s tax mystery points toward the dealings around his first bankruptcies,” Drew Harwell and Robert O’Harrow Jr., Washington Post
“How Rich Do You Have to Be to Not Pay Taxes?” Alexia Fernández Campbell, The Atlantic
“I sold Trump $100,000 worth of pianos. Then he stiffed me.” J. Michael Diehl, Washington Post
“I’m from Atlantic City. I’ve seen how Donald Trump’s false promises devastate a community.” Arielle Brousse, Vox
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Tags: Atlantic City, bankruptcies, business failure, DJT, Donald Trump, GOP, IRS, junk bonds, NOL carry-forward, politics, presidential politics, Republicans, Section 108, Section 1231, small business, tax avoidance, taxes, Trump