According to an analysis of the Times’ tax records, after Trump International Hotel & Tower in Chicago faced financial problems, large banks and hedge funds slowed Trump down significantly, giving him extra time to repay debts, many of which were eventually forgiven.
While previously unreported forgiven debts usually fuel a large tax bill, Trump appears to be almost unable to pay federal income tax on them, partly because of the financial losses his other businesses bear.
Alan Garten, chief legal officer of the Trump organization, told the Times that the company and Trump had paid all necessary taxes on the forgiven debts.
“These are all arm-length deals that voluntarily entered into sophisticated parties many years ago after the 2008 global financial crisis and the collapse of the real estate markets,” Garten said.
According to the Times, Trump arranged for his two LLCs to borrow more than $ 700 million for Chicago development and went to Deutsche Bank for more money.
The bank agreed to lend $ 640 million to the project, but after a construction delay, the loan came while parts of the building were still unfinished.
Deutsche initially granted Trump an extension to repay the loan, but after rejecting an additional extension request, Trump sued the bank with the Fortress Investment Group – which provided a $ 130 million loan for the project – and other banks and hedge funds bought part of the loan, the Times reported.
Trump, according to the newspaper, accused Deutsche of engaging in “extortionate debt practices.” The bank responded with its own claim seeking to repay the loan.
In July 2010, the Times reported that Deutsche Bank had reached a private settlement without disclosing the fort and Trump terms. But Trump’s federal tax returns and loan document show he owes approximately $ 270 million from the project he forgave.
The year he won the presidency and his first year in the White House, Trump paid just $ 750 in federal income tax, the Times reported.
Trump denied the New York Times article and claimed he was paying “too much” in federal income tax.
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