New Report Details Decades Of Presidents Taxes And Financial Failures
On Sunday, The New York Times published a blockbuster report on the Presidents tax returns, revealing details from decades of confidential filings and information related to Trumps businesses. The report paints a picture of a president whose business interests are in financial distress and whose looming money challenges could push him into bankruptcy in the near future. The findings pose a troubling, but important, question to ask:
Is President Trump actually broke?
The explosive reporting by The New York Times is based on a review of two decades of Trumps personal and corporate tax record, ranging from his days as a high-profile real estate developer to the beginning of his tenure as President. In publishing their findings, the Times explained the rationale behind their decision.
We are publishing this report because we believe citizens should understand as much as possible about their leaders and representatives their priorities, their experiences and also their finances. Every president since the mid-1970s has made his tax information public, the Times wrote in an editors note accompanying the report. Mr. Trump, one of the wealthiest presidents in the nations history, has broken with that practice.
The Times added,;The records show a significant gap between what Mr. Trump has said to the public and what he has disclosed to federal tax authorities over many years.
Dont Miss: When To Buy A Car After Bankruptcy
What The F*ck How The Rich Go Bankrupt And Stay Rich
Think bankruptcy and you think losing your home, your car, and your prospects. Bankruptcy is considered to be the ultimate symbol of business and financial failure.
For most of us, thats exactly what it means. But for the rich, it doesnt necessarily mean the end. On the contrary, the rich tend to stay rich even after bankruptcy, in many cases.
Judith And Nicolas Jacobson
Now divorced, the Jacobsons were a married couple who previously owned a chandelier business in West Palm Beach, Florida. In 2004, Trump ordered three fixtures worth $34,000 for his Mar-a-Lago resort from them, but then refused to pay in full, saying the Jacobsons’ work was shoddy, WSJ reports. They denied this claim but facing endless legal wrangling, the couple settled.
“A review of Palm Beach County court records showed no other payment disputes involving Classic Chandeliers. The shop later closed. Mr. Jacobson died in 2015,” notes the WSJ.
Trump defends his history of payment disputes as simply the expected cost of being a tough negotiator in a cutthroat business. The WSJ article, in particular, offers Trump’s camp ample space to respond. They strongly defend the tactics as hard but fair , but the paper notes that they “stood out as particularly aggressive in the industry and in the broader business world.”
Will Trump’s treatment of contractors affect whether or not you decide to vote for him?
Inc. helps entrepreneurs change the world. Get the advice you need to start, grow, and lead your business today. for unlimited access.
Despite Holding Huge Assets Trump Needs Money More Than His Presidential Predecessors Ever Did But He Faces Multiple Barriers Of His Own Making
Find your bookmarks in your Independent Premium section, under my profile
Find your bookmarks in your Independent Premium section, under my profile
As Trump knows only too well, lawyers are expensive
What next for Donald Trump? World leaders dont, as a rule, go hungry upon leaving office. There are positions on corporate boards to take up, lucrative speaking engagements to be booked, handsome advances for books even if they dont sell quite as well as expected . The consulting opportunities are endless, as Tony Blair has proved. Theyre not always terribly savoury but that usually merits only passing attention.
Trump, however, is in the difficult position of needing the money more than any of his predecessors did, despite holding huge assets. He also faces barriers of his own making the insurrection he fomented the most obstructive of all to at least some of the perks former presidents typically enjoy. Many of the people who welcomed George W Bush and cut him a cheque when he wasnt painting wont want to associate with Trump.
His legal problems, meanwhile, are just beginning and legal experts consider the idea of Trump preemptively pardoning himself a non-starter. Besides, this would only cover federal, and not state, offences. ;
Donald Trump’s Companies Filed For Bankruptcy 4 Times
Trump still touts his business sense and wealth as qualifications for president.
Donald Trump’s Bankruptcy History
Trump has built an American empire from Las Vegas to New York with towering hotels and sparkling casinos. Forbes estimates he’s worth $2.7 billion. But not all of Trump’s business ventures have been constant money-makers. In 1991, 1992, 2004, and again in 2009, Trump branded companies or properties have sought Chapter 11 protection.
“I’ve used the laws of this country to pare debt. … We’ll have the company. We’ll throw it into a chapter. We’ll negotiate with the banks. We’ll make a fantastic deal. You know, it’s like on ‘The Apprentice.’ It’s not personal. It’s just business,” Trump told ABC’s George Stephanopoulos last Thursday.
A business declaring bankruptcy is nothing new in corporate America, where bankruptcy is often sugar-coated as “restructuring debt.” But it might seem alarming to everyday Americans who can’t get a bank to restructure their home loans. If you want to get Donald Trump hot under the collar, accuse him of declaring bankruptcy.
Doug Heller, the executive director of Consumer Watchdog, said Trump is the “most egregious, almost comical example” of the disparity between what the average American faces when going through bankruptcy and the “ease with which the very rich can move in and out of bankruptcy.”
“I’m a much bigger businessman. I mean, my net worth is many, many, many times Mitt Romney’s,” Trump said.
Read Also: What Is Epiq Bankruptcy Solutions Llc
‘keep The Donald Afloat’
” could have simply taken everything he had right then, but they wanted his cooperation,” said Lynn LoPucki, a bankruptcy expert and professor at UCLA Law School. “There’s that old saying, ‘If you owe your banks a little, you’re at their mercy. If you owe the banks a lot, the banks are at your mercy. They saw the best way for him to repay the money was to keep the Donald afloat.”
The Donald struck a deal with the banks to hand over half his ownership, and half of the equity, in the casino in exchange for a lower interest rate and more time to pay off his debt. He sold off his beloved Trump Princess yacht and the Trump Shuttle airplane to make his payments, and his creditors put him on a budget, putting a cap on his personal spending.
“The first one was a really big hit for him. They had him personally, and he ended up taking substantial losses in that bankruptcy. He also had the humiliation of having some bankers deciding how much money he could spend — the numbers are just astonishing — the amount of his monthly budget,” LoPucki said.
John Pottow, a bankruptcy expert and law professor at the University of Michigan, said banks would often agree to lose millions in reorganizations like Trump’s to prevent the massive losses they would incur if they foreclosed on the property.
“Banks will take considerable haircuts,” Pottow said. “It’s sort of like you have a sick patient so you cut off a couple toes to stop the gangrene. Now he’s missing a few toes, but he’s still alive.”
How Long Do I Have To Wait Between Filing Bankruptcies
Bankruptcy is a legal process governed by the United States Bankruptcy Court. Bankruptcy can help consumers dig themselves out of a financial hole. Common reasons for filing bankruptcy include job loss, to halt foreclosure proceedings, large medical expenses and to stop garnishments. A 2005 study from Harvard University found that more than half of people file bankruptcy due to medical bills.
Also Check: What Is Epiq
Also Check: Epiq Corporate Restructuring Llc Letter
Were Watching Trumps 7th Bankruptcy Unfold
As a businessman, Donald Trump ran 6 businesses that declared bankruptcy because they couldnt pay their bills. As the president running for a second term, Trump is repeating some of the mistakes he made as a businessman and risking the downfall of yet another venture: his own political operation.
In the 1980s, Trump was a swashbuckling real-estate investor who bet big on the rise of Atlantic City after New Jersey legalized gambling there. He acquired three casinos that by 1991 couldnt pay their debts. The Taj Mahal declared bankruptcy in 1991, the Trump Plaza and the Trump Castle in 1992. Lenders restructured the debt rather than liquidate and Trump put his casino holdings into a new company that went bankrupt in 2004. The company that emerged from that restructuring declared bankruptcy in 2009. Trumps 6th bankruptcy was the Plaza Hotel, which he bought in 1988. It went bankrupt by 1992.
Trumps surprise victory in 2016 paralleled the arrival of the brash upstart in Atlantic City more than 30 years earlier. But in the fourth year of his presidency, the Trump operation is once again reeling. Voters give him poor marks for handling the coronavirus crisis, underscored by an outbreak at the White House that infected Trump himself. Democrat Joe Biden is beating Trump is most swing states and an Election Day blowout is possible. Trump has suggested he wont leave office if he loses, threatening a constitutional crisis and his own political legacy.
Need Help Filing A New Bankruptcy
If you find it necessary to file another bankruptcy, we can discuss your situation in depth and complete privacy by phone or at a sit down free consultation.
Orange County bankruptcy attorney, Norma Duenas, is an experienced bankruptcy attorney who graduated from the University of San Diego Law School, Cum Laude. Ms. Duenas has handled many complex Chapter 7 and Chapter 13 bankruptcy cases. She has previously assisted clients in litigation, immigration matters and has handled hundreds of Chapter 7 and Chapter 13 bankruptcy cases in the Riverside, Orange County, Los Angeles, Temecula and Murrieta areas of Southern California.
If youd like to have a no cost consultation with bankruptcy attorney Duenas, you can make an appointment with our founding attorney, Norman Duenas, by calling or if its after hours and well get back to you.
Dont Miss: Can You File Bankruptcy On Ssi Overpayment
Recommended Reading: Bankruptcy Petition Preparer Guidelines
Time Limits Apply To Discharges Not Bankruptcy Filings
Bankruptcy law doesnt set a minimum period that you must wait before filing for bankruptcy a second time. However, theres a catch. If you file too soon after wiping out debt in a previous case, you wont be eligible for another debt discharge .
Although there are times that it makes sense to file for bankruptcy even though you wont receive a discharge, these situations are rare . Because a bankruptcy filed too soon will end up being a waste of time and money in most cases, its essential to know how to time your bankruptcy filing.
Recommended Reading: Filing For Bankruptcy In Wisconsin
What If My Previous Case Wasnt Discharged
Sometimes the bankruptcy court dismisses or ends a case without a discharge. That could happen if you failed to appear in court, ignored a court order or voluntarily dismissed your own case because a creditor filed a motion to continue collection efforts. If your case was dismissed, you have to wait 180 days to file again. Note that subsequent filings might not earn you the automatic stay of collection, repossession and foreclosure actions. So you may not be as shielded from creditors pursuing payment.
In other instances, courts can deny the discharge of your debts in a bankruptcy. Reasons for denial include failure to provide documents, hiding assets or perjury.
Also Check: Can You Be Fired For Filing Bankruptcy
Trump Hotel & Casino Resorts 2004
Trump didnt go back to bankruptcy court again until November 2004, when he filed to shed debt at his various Atlantic City casinos and a riverboat in Indiana. It was another quick trip through bankruptcy court; the company shed $500 million in debt and emerged from bankruptcy the following May. Trump turned over majority control of the company to his bondholders but remained the largest single shareholder, and he once again kept control of the casinos.
Business Career Of Donald Trump
|This article is part of a series about|
Donald Trump is an American businessman and television personality. He was the 45th president of the United States. He began his real estate career at his father’s company, Elizabeth Trump and Son, which he later renamed the Trump Organization. He rose to public prominence after concluding a number of highly publicized real estate deals in Manhattan, and his company now owns and licenses his name to lodging and golf courses around the world. Trump partly or completely owned several beauty pageants between 1996 and 2015. He has marketed his name to many building projects and commercial products. Trump’s unsuccessful business ventures have included numerous casinos and hotel bankruptcies, the folding of his New Jersey Generals football team, and the now-defunct Trump University.
After being inaugurated as U.S. president in January 2017, Trump resigned all management roles within the Trump Organization, and delegated company management to his sons Donald Jr. and Eric. However, Trump retained his financial stake in the work document, leaving ongoing concerns about possible conflicts of interest.
You May Like: What Is Epiq Bankruptcy Solutions Llc
Donald Trump Drove His Companies Into Bankruptcy Six Times
Three of Trump’s properties filed for bankruptcy in 1992. Three other properties filed for bankruptcy – one at a time in 1991, 2004, and 2009.
Trump has previously claimed that he filed for bankruptcy for four of his companies. On Day 4 of the Democratic National Convention, Michael Bloomberg said that Trump had driven six of his companies into bankruptcy. We found that Bloomberg was right, and Trump filed for bankruptcy six times.
Trumps companies have filed for Chapter 11 bankruptcy protection, which means a company can remain in business while doing away with many of its debts. The bankruptcy court ultimately approves a corporate budget and a plan to repay remaining debts; often, shareholders lose much of their equity.
The Washington Post reported that Trumps Taj Mahal, which opened in April 1990 in Atlantic City, defaulted on interest payments to bondholders six months later. In July 1991, Trumps Taj Mahal filed for bankruptcy. He could not keep up with debts on two other Atlantic City casinos, and those two properties declared bankruptcy in 1992. A fourth property, the Plaza Hotel in New York, declared bankruptcy in 1992 after amassing debt.
NBC reported that Trump Hotels and Casinos Resorts filed for bankruptcy again in 2004 when his casinos, including the Trump Taj Mahal, Trump Marina and Trump Plaza casinos in Atlantic City, and a riverboat casino in Indiana. They had accrued an estimated $1.8 billion in debt.
Bankruptcy Is Not Synonymous With Failure
Although a corporate bankruptcy filing often indicates that a business is in a perilous financial condition, it doesnt necessarily sound the death knell for that business. The provisions of Chapter 11 of the U.S. Bankruptcy Code allow businesses to find ways to reduce their debt and restructure their operations without having to be shut down and liquidated to satisfy debts instead of closing their doors, businesses can stay open, pay their employees, and take in revenue while developing a budget and a repayment plan for creditors .
Many of the United States largest and most prominent businesses have filed for Chapter 11 bankruptcy protection one or more times, including General Motors, Charter Communications, Delta Air Lines, Kmart, Macys, and the Texas Rangers baseball team.
Don’t Miss: Get Personal Loan After Bankruptcy
Under Attack For Bankruptcies
During the Republican primary prior to the 2016 election, Trump was not the only businessperson attempting to win the presidency, though he was certainly the one who received the most press coverage.
One of Trumps challengers was the former chief executive officer of Hewlett-Packard, Carly Fiorina, who used a debate performance in September 2015 to land one of the few attacks on Trump that appeared to bother him.
Discussing the issue of federal debt, Fiorina questioned if Trump was the right person to tackle the issue.;
You ran up mountains of debt, as well as losses, using other peoples money, and you were forced to file for bankruptcy not once, not twice, four times.
Trump fired back, saying it was normal for businesses to declare bankruptcy as a strategy. I used the law four times and made a tremendous thing, he said. Im in business. I did a very good job.
After the debate, the nonpartisan PolitiFact website ran the article, Fact-checking claims about Donald Trumps four bankruptcies, in which it rated Fiorinas statement Mostly True. Trump had indeed declared Chapter 11 bankruptcy four times, but, the site qualified, Fiorinas statement doesnt tell the whole story.
Lessons To Be Learned From Trump
While filing for bankruptcy is something wed all like to avoid, there are some lessons to be learned from Trumps forays:
- Make long-term goals for your businesss success
- Keep your personal and business finances markedly separate
- Analyze your careers long-term potential
- Trust in legal advisors for counsel
The last lesson is especially important. Without experienced legal advisors, the results of Trumps bankruptcies might have ended up another story altogether.
If youre considering filing for bankruptcy on behalf of your business, consult Tyler, Bartl, Ramsdell & Counts Law Firm. Our firm has counseled countless individuals and businesses in bankruptcy matters for over 25 years. To safeguard your financial future, give us a call today at 549-5000 to schedule a free consultation.
Also Check: Has Mark Cuban Ever Filed For Bankruptcy