Donald Trump funnels over $700,000 to Ivanka to lower his taxes

The Trump Timeline

Sources linked at end of page.

Statistics

Related Topics

Sometime between 2012 and 2014, date unknown, Donald Trump uses the Trump Organization to pay a consultant $747,622 for fees related to hotel projects.

That consultant is Ivanka Trump.

Rather, there appears to be a closer-to-home explanation for at least some of the fees: Mr. Trump reduced his taxable income by treating a family member as a consultant, and then deducting the fee as a cost of doing business.

The “consultants” are not identified in the tax records. But evidence of this arrangement was gleaned by comparing the confidential tax records to the financial disclosures Ivanka Trump filed when she joined the White House staff in 2017. Ms. Trump reported receiving payments from a consulting company she co-owned, totaling $747,622, that exactly matched consulting fees claimed as tax deductions by the Trump Organization for hotel projects in Vancouver and Hawaii.

The New York Times

Ivanka was actively involved in those projects through her role at Trump properties. Therefore, she was not an outside consultant.

If the payments to his daughter were compensation for work, it is not clear why Mr. Trump would do it in this form, other than to reduce his own tax liability. Another, more legally perilous possibility is that the fees were a way to transfer assets to his children without incurring a gift tax.

It’s likely that the payment is illegal.

The I.R.S. has pursued civil penalties against some business owners who devised schemes to avoid taxes by paying exorbitant fees to related parties who were not in fact independent contractors. A 2011 tax court case centered on the I.R.S.’s denial of almost $3 million in deductions for consulting fees the partners in an Illinois accounting firm paid themselves via corporations they created. The court concluded that the partners had structured the fees to “distribute profits, not to compensate for services.”

Source

https://www.nytimes.com/interactive/2020/09/27/us/donald-trump-taxes.html

Photo: Public Domain

Get More Trump Secrets in Your Inbox

Statistics

Related Topics

Also On Trump File