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Frustratedlady

(16,254 posts)
Mon May 20, 2019, 09:14 AM May 2019

I have never believed the story about Trump's losses on his tax returns.

I don't understand money laundering or how it is done, but when I saw the article about Trump not paying taxes in 8 out of 10 years due to losses, I found that hard to believe. I believe he took the losses, but I would lean toward Trump pulling money out of his businesses because other real estate companies were taking advantage of a bad market and he saw an opportunity to make money through lying. The combination of Trump's lies, exaggerations and ability to falsely declare values depending on how that act might help him to be more likely. Now, I see where Deutsche Bank was also questioning The Don and Jared of financial manipulation.

How do people launder money? Is it mostly from drug sales or cash they've made that they don't want anyone to know about? Windfalls? Ill-gotten gains of some type?

Could Trump have sold or given real estate to foreign entities in exchange for huge favors and taken that money for a loss? I can see Trump failing for a couple years, but not that many and those 8 are the only ones we know of. How many more?

This is just a thought I need to get out of my head if it isn't possible. For those who are familiar with how people manipulate their wealth through money laundering, I'd sure love to hear how it's done.

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I have never believed the story about Trump's losses on his tax returns. (Original Post) Frustratedlady May 2019 OP
Same here malaise May 2019 #1
so hes either gotta fess up about the losses or fess up about laundering..ha! whatta choice. samnsara May 2019 #2
Real Estate is a great way to launder money CanonRay May 2019 #3
Well, that deal in Florida where they bought a property for a few million, Frustratedlady May 2019 #4
some simply skim profits then claim it as losses duforsure May 2019 #5
I used to be a tax accountant customerserviceguy May 2019 #6
Thanks for the explanation. Frustratedlady May 2019 #7
You're welcome customerserviceguy May 2019 #8
Donald Trump Was Supposedly a Really Bad Businessman erpowers May 2019 #9
Yes, I realize that is true about his business acumen or lack of, but he is simply a natural con man Frustratedlady May 2019 #10

samnsara

(17,570 posts)
2. so hes either gotta fess up about the losses or fess up about laundering..ha! whatta choice.
Mon May 20, 2019, 09:17 AM
May 2019

..popcorn time!

CanonRay

(14,036 posts)
3. Real Estate is a great way to launder money
Mon May 20, 2019, 09:26 AM
May 2019

Invest your dirty money in a property, sell it, and the money is clean. Gee, wonder who deals is real estate that would do this? Why do Russians own so many of Trumps properties?

Frustratedlady

(16,254 posts)
4. Well, that deal in Florida where they bought a property for a few million,
Mon May 20, 2019, 09:35 AM
May 2019

did nothing to it and sold it for mega million$ later on is a good example. Wasn't Trump involved in that? Dimitry something or other from Russia? He was in the process of getting a divorce and tried to hide the money from his about to be ex. Seems his plane was often seen parked at the airport when Trump was at Mar-a-Lago. But then, my memory "ain't" the best.

customerserviceguy

(25,183 posts)
6. I used to be a tax accountant
Mon May 20, 2019, 04:05 PM
May 2019

and I do believe it.

Real estate depreciation is one of the biggest loopholes in the tax code. As everybody knows, the earliest half of a mortgage payback period is one where you pay very little in principal payments, the vast majority of payments go for 100% tax deductible interest on an investment property. But, in that time, you take off of your ordinary income way more that that original loan amount in depreciation deductions.

Then, when the building sells, you recapture the depreciation, but to the extent that your recapture is within what straight-line (versus accelerated) depreciation, you only pay capital gains tax on that, either 40 or 50 percent (depending on what the tax law was in the year of the sale) as well as only paying capital gains tax on the amount the building appreciated during the time you owned it.

The basic principle of tax avoidance is this: If you give me a dollar every year for ten years, and then in the eleventh year, I pay you back ten dollars, then I've "won" because I had the use of your money for all that time. With real estate depreciation deductions, imagine that in the eleventh year, I only had to pay you back four or five bucks. Now, I'm really winning!

If you combine an economy with real estate inflation along with constantly buying more and more property, you can see how Trump did this. He claimed large paper losses that were really not losses against the taxable portion of the gains that he made on earlier deals, nullifying them as he kept going on to acquire more and more real estate. Tax law provisions even allow an individual with massive "losses" to apply those losses to previous or future tax years.

Frustratedlady

(16,254 posts)
7. Thanks for the explanation.
Mon May 20, 2019, 05:16 PM
May 2019

I realize tax laws have given a lot of advantages to some business areas and should be changed, but it makes you wonder how many are manipulated by fancy lawyers to get even bigger benefits for the big guys compared to the majority of us. It always irritates me to no end how large corporations get by with paying no taxes (and, even receiving humongous refunds) for year after year. Granted, if the benefits or loopholes are there, take advantage of them, but I could see Trump going "bigly" overboard when he saw an opening. As Cohen said, Trump was able to inflate/deflate the value of his holdings when it benefitted him.




customerserviceguy

(25,183 posts)
8. You're welcome
Tue May 21, 2019, 03:51 PM
May 2019

I also used to work as a real estate title officer. Early on in my career at that, I asked an agent, "How do you know how much to list a house for?" He replied, "There are three prices for any house, the one that sells it in two weeks, the one that sells it in two months, and the one that sells it in two years."

My suspicion is that Trump's accountants just cherry picked the prices they needed for the occasion.

erpowers

(9,350 posts)
9. Donald Trump Was Supposedly a Really Bad Businessman
Wed May 22, 2019, 06:07 PM
May 2019

You may be right, but Donald Trump was supposedly a really bad businessman. According to the book Trump Nation, Trump's casino is Atlantic City was 100,000 square feet too big for its location. It is very possible that Donald Trump was really that bad of a businessman. As you may know many of the businesses Trump started later failed.

Frustratedlady

(16,254 posts)
10. Yes, I realize that is true about his business acumen or lack of, but he is simply a natural con man
Wed May 22, 2019, 07:25 PM
May 2019

What goes with that is the horrendously strong urge to cheat and do it with style. If you cheat enough with your businesses on paper, you can fail.

In my humble opinion, he should not have been allowed to have so many bankruptcies. He's just a carnival barker in a suit (my apologies to carnival barkers).

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