Question - Shouldn't This Be Considered Income?

[NowISeetheLight]

I was watching Seth Meyers clip tonight on youtube. He said Trump had spent over $100m from his "Save America PAC" on his legal expenses.

My question is why isnt this considered income for him then? Like a gift tax or something? It should be taxed. It benefits him personally.

Im not a tax lawyer so i dont know. But it just seems wrong.

[Frasier Balzov]

1. CREW agrees with you.

https://www.citizensforethics.org/wp-content/uploads/2022/01/2022-1-21-Letter-to-Trump-re-RNC-legal-spending-taxable-income.pdf

[ALBliberal]

2. I agree (long time cpa here).

It’s like he received the income then turned around and spent it on non deductible legal costs. So just because the PAC is paying it directly shouldn’t matter.
Would seem a serious breach of campaign finance laws as well?
Our laws can’t keep up with this crazy guy.
Garland certainly can’t (not that he’s trying). Definitely not the IRS who has let him grift for years.
And he just plows ahead laughing at us law abiding citizens.

[brooklynite]

7. Every campaign pays for legal services; so does every PAC

There's no specificity as to what those legal services have to be for.

Its not a violation of campaign finance law if the "Trump" contributions say (in the fine print) that some or all of the donation will go towards the PAC.

Consider that the Biden campaign isn;t claiming a campaign finance violation.

[KPN]

8. This is whast's wrong ...

[spanone]

3. He won't pay a penny.

[Warpy]

5. Jerks like him always seem to get nailed by the IRS

if other civil and criminal courts fail to do the job.

[brooklynite]

6. No its not, for this reason

Trump is not spending the money because Trump doesn't legally run the PAC. While he benefits from the legal representation, its not considered "income" or a "gift" any more than a Public Defender paid for by the Government is.

[brooklynite]

9. If the ACLU provides you with a free lawyer to argue a reproductive rights case, should you consider that "income"? No.

[AverageOldGuy]

10. I'm not a tax attorney . . .

. . . but I suspect it has to do with the way PACs were set up by the people in Congress who benefit from PACs.

For example, SarahPAC -- Sarah Palin's PAC -- was an unlimited PAC which means she used the millions donated to her to buy property in Arizona for herself and her children, pay for childcare for her Down Syndrome son, and everything but political purposes.

[unblock]

11. They can probably argue that it's a legitimate campaign expense

The campaign benefits from Donnie getting a good result in court, and the campaign is in trouble if Donnie gets a bad result in court. So it's probably a legitimate campaign expense even though Donnie benefits personally and would have had to pay as an individual if he didn't have a campaign to suck funds from.

CEOs benefit personally from many corporate expenses, such as travel (they love spending a week for brief meetings or "conferences" in places like Turks and Caicos or Hawaii) or limo services. High profile CEOs can probably justify home security and bodyguards.

Btw, gift tax probably doesn't apply to any of this, but if it did, it's the donor who pays gift tax, but the recipient.