- This episode of LegalEagle was made possible by Skillshare. Learn to think like a lawyer
for free for two months by clicking on the link
in the description. Well, it finally happened
Donald Trump's taxes have been released, or more specifically, they've been leaked. And the information contained inside helps paint a picture of why the President wanted to hide the
information for so long. Since at least 2015,
Americans have wanted to know one thing about Donald Trump's finances, does he pay taxes or not? The New York Times has now
answered this question. President Trump has paid zero taxes for 10 of the last 15 years. He paid $750 in taxes the
year he became president and the year after and even then it was only because his accountants wanted him to pay something. - He didn't understand the code, nor would he have had
the time and the patience to learn the provisions. He knew that we would produce the lowest possible tax
for him within the law. - He deducted personal expenses like $70,000 in hairstyling services, he paid hundreds of thousands
of dollars to his children who he was also employing as W2 employees. And before he became president, he was hemorrhaging money,
gobs and gobs of money. So President Trump pays
basically zero in taxes because almost all of his businesses operate at a huge loss on paper where he is perpetually
inflating the costs and minimizing his income. President Trump portrays
himself as a populist, but he operates more like Bernie Madoff, a guy who cooked the books to make himself look like a genius until his entire venture collapsed. But are these activities
actually tax crimes that could get President Trump in legal trouble or even jail time? Or is it just legal and smart
tax avoidance strategies by a financial pro working
their magic over the tax code? Well, we finally have a window into answering these questions. (orchestral music) Hey, LegalEagles, it's time
to think like a tax lawyer because the President's finances and the finances of the Trump Organization are a web of interlocking companies, all of which appear to use extremely suspicious tax
and financial strategies. Now, it appears that The New York Times has access to the President's
personal tax returns going back 20 years as
well as the tax returns of the different Trump Organization LLCs, of which there are hundreds of them which are interrelated to the President, because of their past through nature. We'll probably cover the
liability of this whistleblower in a different video, but suffice to say the information that they
divulge appears to be accurate. Now, the whistleblowers liability is an interesting question. But under the Pentagon Papers case, New York Times versus the United States, unless The New York Times
suborned the actual leaking or the whistle-blowing
and actually facilitated the actual act of
disclosing the tax returns, The New York Times is almost certainly
free to cover the story and will probably escape
any kind of liability regardless of whether the person who actually blew the whistle and or leaked the information
has personal liability, which they might. So the question for the public is can we come to any legal conclusions based on the information
that was divulged? Well, let's start with the tax code. Title 26, Section 7201 of the tax code creates the federal crime of tax evasion, which has historically been
the main tax revenue offense. There are two potential
offenses under Section 7201. Subsection 1: The willful attempt to evade or defeat the assessment of a tax. And two: The willful
attempt to evade or defeat the payment of a tax. The most common attempt
to evade or defeat tax is the affirmative act
of filing a false return that omits income and or claims
deductions for the taxpayer that they're not entitled to. The tax reported on the
return is falsely understated and creates some deficiency and when someone underreports their income this is an attempt to evade or defeat tax by evading the correct
assessment of that tax. To prove these crimes, the government must prove
that the defendant engaged in some affirmative conduct that was designed to mislead the IRS or conceal the tax liability or assets. And often this comes in
the form of deductions that you're not actually allowed to take or personal expenses that you
say are a business expense. And when there is a pattern of overstating or inflating deductions, the IRS can charge you with tax evasion. And this may be a problem
area for the president because for years, President Trump has classified most of the money he spends on his lavish lifestyle
as a business expense. For example, President Trump claimed the cost of air travel and car services to and from his private
homes as a write off, he itemized over $70,000
in hairstyling fees for whatever is on his head. He also deduct the expenses for Ivanka's his hair and makeup artists to the tune of nearly $100,000. Hair and makeup deductions are pretty straightforward deductions. A haircut or makeup application isn't deductible unless the use is limited exclusively to the
business appearance itself. And that's hard with the haircut
because the haircut lasts after you have done the
thing that you're doing. And then there's things like using an investment property for
your own personal purposes. President Trump took a deduction for an investment property
located in Bedford, New York. This home which the Trump
family called Seven Springs has been in the Trump family since 1996. And the Trump offspring have bragged about spending summers
at the 200 acre estate. According to the the Trump
Organization website, "Today Seven Springs is used as a retreat for the Trump family." If it's a personal retreat
for the Trump family, how can it be an investment property? As an investment property,
Trump has been able to write off $2.2 million in
property taxes since 2014. We don't have any evidence
that Seven Springs is actually being rented out or developed, which is typically how you
would show that a property is an investment property
rather than a residence. Instead, the property is described by the Trump Organization
website in loving terms complete with a photo spread,
emphasizing its opulence and Trump's own tax declarations also work against this
claim of Seven Springs as an investment property. One year after he made the designation he claimed a tax deduction on the property for a charitable easement. A charitable or conservation easement is another way of creating a tax shelter. But basically you can give the government or your
public interest rights to your property such as the right to prohibit development or a property to preserve
the nature surrounding it. That charitable easement on Seven Springs precluded from being developed. And then there's things like potentially bogus consulting fees. Companies are allowed to
deduct consulting fees from their income because
they are a business expense. This reduces the tax bill
because the income that is taxed is lowered by the amount
of the consulting fees, just like any other business costs. So if Trump's businesses deducted
legitimate consulting fees that is not by itself tax evasion. However, the Trump Organization consistently reports that
about 20% of its total income was paid to consultants, and this applies across all projects. So when Trump made $5 million in income on a hotel deal in Azerbaijan, he reported $1.1 million
in consulting fees. In Dubai, he made $3
million in income on a deal but reported $630,000 in consulting fees. These fees, reduce income
and thus reduce income tax. But on deals where you
don't own the property, and you're only making money
on the licensing of your brand, as Trump was doing with
these foreign deals, the last thing you want is
a huge 20% consulting fee, unless you're also benefiting from that consulting fee personally. It's also suspicious that the
fee is approximately the same regardless of the size of the deal and the relative lack
of need for consultants, but further inquiry would be needed to get to the bottom of this. And let's put aside the problematic nature of a president getting foreign income from effectively dictatorships, because there's even
more damning information involving consulting fees
linked to Ivanka Trump. Ivanka has a formal position
at the Trump Organization for which she gets a salary. But at the same time, it appears that Trump's company
once paid $747,000 in fees to an unnamed consultant for hotel projects in
Hawaii and Vancouver. Coincidentally, when Ivanka Trump later filed public
disclosure forms in 2017, she listed payment for
the identical amount. So it looks like Ivanka, an employee of the Trump Organization also got paid a hefty consulting fee through a consulting
company that she co owned. Would this raise a red flag with the IRS? Absolutely, if Ivanka
received a consulting fee on the same project that she managed as an employee of the Trump Organization, which is what The Times alleges, this looks like evidence of fraud. Anytime a company pays a
family member consulting fees it looks like the family is
conspiring to hide income. Consulting fees being paid to family members also looks like gifts. which aren't deductible and in
fact, if the fees were gifts, then Trump would have
liability for paying gift tax. The bottom line is that paying
a family member employee through a shell corporation
could be a way to avoid gift tax and a way to avoid payroll taxes. And it doesn't appear that Ivanka is the only adult Trump's child who engaged in shady practices. That brings us to legal
fees for Donald Jr. The IRS says that legal
fees can be deducted when they are directly related
to operating your business, but this does not include legal fees paid to defend charges that
arise from participation in a political campaign. However, the tax records show that the Trump Organization
wrote off business expenses paid to criminal defense lawyers who represented Donald Trump Jr. during the Russia investigation. The lawyer received at least
$1.9 million in 2017 and 2018. And Trump wrote off about $260,000 paid to William and Jensen, a second law firm hired
to represent Trump Jr. As you might recall, a lot
of the Russian investigation was related to meetings that Donald Jr. had with people promising
dirt on Hillary Clinton, so it doesn't appear that this could be a legitimate business expense. These are all potential examples of the most simple form of tax evasion, deducting expenses as business expenses that are not actually for your business. It's possible that some
of these deductions might be defensible, but it
would be an uphill battle. Tax experts often say
that it's very difficult to surmise tax evasion on
the face of the returns, and that one usually needs to dig in to the actual expenses and deductions before concluding anything. So take The New York Times
analysis with a grain of salt. But that said, almost
every professional says that some of the items
in the Trump returns are so brazen to be
almost certainly improper, but it's possible for
justifications for them. Of course, this is one of the reasons why historically presidents
release their taxes to avoid even the
appearance of impropriety. And also on the other hand, these are only the seemingly
improper deductions on the face of the returns themselves. If you actually dug into the underlying
expenses and deductions that appeared to be proper, you might find things that are even worse. Now, in fairness, these
potentially inflated, potentially improper deductions make Trump's businesses
look less profitable than they might actually be. And one additional point, a lot of experts are taking
these returns at face value since The New York Times is not releasing the underlying documentation. But given the improprieties
on the surface, it's almost certain that the underlying numbers
themselves are wrong, to what extent? We don't know. Now, a lot of these things look bad, but it's important to know that it can be incredibly difficult to prove the crime of tax evasion. Because most of these crimes require the mental state of willfulness. We talk about mental states
on this channel a lot because almost every criminal law requires a certain
mental state, a mens rea, to prove the crime itself. And here willfulness is defined as, "The voluntary intentional
violation of a known duty." This is known in the law
as a specific intent crime that comes from the case of
Cheek versus United States, which is a really interesting
Supreme Court case, where a tax Professor John L. Cheek, failed to file tax returns and
was convicted of tax evasion. But the court held that
his good faith belief that he wasn't violating the tax law based on a misunderstanding caused by the complexity of the tax law, actually negated the willfulness element. And that applies even if that belief is irrational or completely unreasonable. So this is one of those rare cases where having a misunderstanding of the law or sometimes ignorance of the law actually can be a defense, which is pretty rare for obvious reasons. But also note that the court has ruled that an actual belief that the tax law is invalid or unconstitutional
is not a good faith belief based on a misunderstanding
of the tax law. So that's not a defense. So sorry for all of you
sovereign citizens out there. And another thing that's
incredibly important in this context is what the tax preparer tells the tax filer, often people use the defense of relying on their tax professional
for the advice about what the tax law is, or is not, which can also provide a defense. But the bottom line is
this is a subjective test, a defendant's good faith belief that he's not violating the tax law, no matter how objectively
unreasonable or stupid that is, can be a defense in some tax prosecutions. And to try and keep my sanity, I'm going to try to
refrain from putting myself in the head of Donald Trump, and who knows what mental state he had or did not have when
he was filing his taxes and claiming all of
these various deductions. Which brings us to the more complicated but just as serious potential crimes under Title 18 regarding a refund. Tax fraud cases are distinguishable from those involving false
claims for a tax refund, which are generally prosecuted as violations under 18 USC 286, which is conspiracy to
defraud the government by obtaining or aiding to
obtain the payment or allowance of any false fictitious
or fraudulent claim, and 18 USC 287, making or presenting false, fictitious, or fraudulent claims upon or against the government. The New York Times investigation uncovered Trump tax refund which is currently the
subject of an IRS audit. And President Trump wasn't lying when he said his finances
have been under audit for an extremely long time. And this requires a bit of background. Trump made his reputation
in the 80s and 90s through lavish properties and casinos. However, the business has
lost over a billion dollars and four of them filed for bankruptcy. In 1995, Trump declared a tax loss of more than $900 million related to his Atlantic City casinos, and the IRS let Trump offset the profits of his businesses in the future
by using his past losses. So you can offset $900 million in profit using $900 in losses. The tax loss carryovers from
the casinos came in handy reducing the Trump
Organization's tax bill to zero once the company started doing well again. Now, put a pin in this $900 million loss because we're gonna come back to that. But even after the company's recovered from the casino implosion
it lost big money on the 15 golf courses that
Trump started buying in 2000. Trump reported that the golf courses collectively lost over $315 million. But were these losses really legitimate? The Times report says
that from 2016 to 2017, general and administrative expenses at the Bedminster Golf Club alone had increased by five times. Now, why would business
expenses increase five times on businesses that were failing and never generated a profit? And well, it's possible that someone purposefully inflated the expenses. Inflating expenses on a failing business is a classic money laundering tactic, which you would know if you've
ever seen the show Ozark. Now, the prospect of money laundering is beyond the scope of this video, but I'm betting that we
haven't heard the last of this. And I recommend checking out
the reporting of Adam Davidson, who looks at the Trump
properties across the world. And what he sees is a continual pattern of failing businesses
needing a cash infusion, getting a cash infusion as a loan from Donald Trump personally, and then that money basically
disappearing to parts unknown, which might be money
laundering, we'll have to see. And not to mention Trump's incredibly suspicious foreign income. For example, Trump used to own the Miss Universe Pageant
which lost millions in both 2012 and 2014. But right in the middle in
2013, Trump made millions because of a one time payment
from the Agaralov family, Russian billionaires who have
close ties to Vladimir Putin. A huge one time payment in a money losing venture
could be an overpayment, or it could be an effort to
funnel money for another reason. But what we do know is
with these massive losses, what saved Trump's businesses
from going belly up was revenues from The Apprentice, and a few profits
generated from Trump Tower, one of the few pieces of real estate that he actually made a profit on. And this cash infusion from The Apprentice was good news for the Trump Organization. But it also meant that
for the first time ever, President Trump had a big tax bill, and Trump had to pay $70
million in taxes and he paid it. But in 2010, Trump told the IRS that, oh, by the way back in 2008 and 2009, his business happened to
lose about $1.4 billion. Trump claimed that this huge loss entitled him to a full
refund of the income taxes he had paid in 2005, 2006, and 2007. And amazingly, the IRS quickly
paid out this massive refund over $70 million, and
state and local governments followed suit giving him back
an additional $21 million. Trump went from telling the
IRS that he was doing well to suddenly losing another $1.4 billion. And where did these heretofore unknown business losses come from? Well, remember that $900
million abandonment loss he suffered as a result of
the Atlantic City casinos. In 2009 he reported that he abandoned his disastrous casinos
which filed for bankruptcy. And when you abandon a business, you can take a deduction
for some of the losses, as long as you don't
receive anything of value. In other words, you
have to truly give it up for nothing of value in exchange. And according to IRS Publication 544, sales and other dispositions of assets, abandonment losses from
business or investment property are generally deductible
as ordinary losses, meaning you get a one-to-one deduction on all of the losses that you suffered, as long as the abandonment is not treated as a sale or exchange
of anything of value. But The Times reports
and public records show that Donald Trump actually
did get something of value in exchange for his old interest in the bankrupt Atlantic City casinos. He actually got a 5% stake in the casinos successor company. So this tax refund of over $70 million is being audited and has been audited for basically a decade. And tax law actually requires that all refunds of more than $2 million, get approval from Congress's
Joint Committee on Taxation. And that's where this matter has been stalled for several years. We don't know exactly why
this has not been resolved, but the word politics almost
certainly comes to mind. And recall that for over a year, we've known an IRS whistleblower that says a member of
the Treasury Department tried to interfere with an audit of Donald
Trump or Mike Pence. It seems that these two
things might be related. If Trump loses the audit,
which it appears he should he'll be on the hook to repay
not just the 72 million, but also fees and interest bringing the total to over
$100 million in repayment, that alone could bankrupt the
undercapitalized president. So now we get into the meat
and potatoes of the matter, did Donald Trump commit tax fraud? Tax fraud is generally not
that difficult to understand, although there are certainly legal ways to limit your tax exposure. We'll get to those in a minute, and arguably, people are perfectly allowed to pay the minimum amount in taxes that they legally have to pay. There are also clear prohibitions
against lying to the IRS. Not that President Trump
has ever been caught lying. But let's talk about
making false statements. Section 7206 of the tax
code deals with tax fraud and making false statements to the IRS. These violations typically
result from a taxpayer falsely inflating deductions
or underreporting income on federal income tax returns
to reduce or avoid tax burden. And a section 7206 felony prosecution is not limited to tax returns it deliberately applies
to, "Any return statement or other document required
by the Internal Revenue Code or applicable regulations." Though know that convicting someone of providing false or fraudulent
information to the IRS still requires a show in willfulness which we discussed earlier. But it can be easier to prove
then outright tax evasion in the false information context, but you still have to show willfulness and under United States versus Clairborne, neither a showing of careless disregard nor gross negligence and signing
a tax return will suffice. But it's not all smooth
sailing for the tax filer. On the other hand,
willfulness can be inferred from the rest of the tax documents and from circumstantial evidence. And proof of a pattern of
falsity supports an inference of willfulness under United
States versus Conlin. And while some have argued that Trump can't form the
requisite mental state, because he's so all over the place, there is a presumption that
you know what's in your taxes when you sign it. And liability for lying to the IRS is not limited to the taxpayer alone and includes people who
prepared the returns, corporate officers, and
even tax shelter promoters. So in the Trump world, many
people could be on the hook for these returns like
President Trump's accountants. Allen Weisselberg, CFO
of the Trump Organization is probably also on the hot seat. And during a deposition related to a lawsuit
against Trump University, Weisselberg said only five
people have the authority to sign checks for the company, Donald Trump, Donald Trump Jr. Eric Trump, Ivanka Trump, and himself. And you might recall that former Trump lawyer, Michael Cohen also set up a shell company to conceal the hush money
payments to porn stars and coordinate strategies
with the National Enquirer, a process that probably also involve making false statements, because spoiler alert,
there isn't a line item related to the payment of stormy Daniels. So it looks like those
payments tried to be hidden in normal business operating expenses. But actual preparation of a false return is not necessary to sustain a conviction. Just supplying false information can be enough in some
cases for conviction. Of particular interest to Donald Trump as a real estate magnate is United States versus
Lefkowitz, where the defendant, a manager of several real
estate limited partnerships lied to his accountants that the projects were pre-leased to qualified low-income tenants, and therefore the limited partnerships could begin taking tax credits when the units were placed in service. That guy was convicted because
he gave false information to the limited partnerships causing them to file fraudulent returns. But let's take a moment now to talk about lawful tax avoidance. A lot of the President's defenders claim that Trump is doing what all
successful businesses do, just exploit legal loopholes
to reduce taxation. And there's a lot of people who argue I think, persuasively that
no individual or corporation has an obligation to pay any more taxes than they are legally required to do. And tax avoidance is just the legitimate minimizing of taxes and maximizing after tax income using methods included in the tax code. And lots of businesses avoid taxes by taking all legitimate
deductions and tax credits and sheltering as much income as possible. This is all legal. The IRS even has a cheat sheet summarizing the difference between
avoidance and tax evasion, which is illegal. A tax loophole is tax avoidance. A loophole is usually a
deliberate clause in the tax laws that legislators created to
reduce certain people's taxes. And we can argue whether
that's a good idea or not, but a lot of the tax code is written specifically to give benefits to certain groups or individuals. And since the tax code is so complex, savvy tax experts have
found ways to lower taxes for their clients without breaking the law and taking advantages
of the law as written. And I have absolutely no doubt that some of Trump's
deductions were legal, but the idea that Trump is just a genius who was acting like
other business geniuses should probably be scrutinized. So let's talk about the
actually uncontroversial idea that business losses offset
the taxes on business profit. If President Trump is actually losing lots and lots of money, and then taking that deduction, is this really a smart tax maneuver? Well, actually, no. But during a presidential debate in 2016, President Trump said: - I have a write off a
lot of its depreciation, which is a wonderful
charge, I love depreciation. - And that makes sense
because depreciation allows the owner to take
depreciation deductions on the property that's
probably still gaining value. For example, if you own a property, that's worth a million dollars, even if it's appreciating in value, you're allowed to deduct a certain amount of the value of that property per year. So if you have a property on Fifth Avenue in Manhattan, for example, it may depreciate for tax purposes, but it'll keep gaining value. And this is all basic stuff that you learn even playing Monopoly. And we can argue over whether
real estate developers should be allowed to take depreciation on an asset that actually
is going to exist for a very, very long time and is actually appreciating in value, but that's actually the law. And that's why inheriting
established properties in the New York City real estate market with no debt attached
like Donald Trump did from his father Fred, can be so lucrative. You're allowed to take a
whole bunch of deductions from the physical property of
the real estate in New York. However, there's a big distinction between a sensible depreciation deduction and being forced to take a deduction because of actual business
losses that you suffered. Marty Ginsburg, who was the husband of Ruth Bader Ginsburg was considered a spectacular tax lawyer and professor, and he authored a famous article called, "The Leaky Tax Shelter," where he made the point that
the key to a tax shelter is not actually suffering
the losses that you deduct. Ginsburg joked that a bad
tax shelter idea was saying, "Hey, give me a million
dollars of your money and run away to it with a
country where you can't get me, and then you have a million
dollar theft deduction." The point is that your
goal isn't losing money than deducting the money that you lost. That doesn't make you a genius
or even particularly shrewd. Since 2000, Trump lost
more than $315 million at golf courses like Trump National Doral and The Washington Hotel
which opened in 2016, and has lost more than $55 million. Across the world his golf
courses are hemorrhaging money, the vast majority of the losses
appear to be real losses, not magic deductions conjured
up by a financial whiz. In other words, his economic losses far outweigh his tax losses. Trump's businesses are pretty simple, real estate and licensing, and he appears to be
exceedingly bad at it. But as the president and his adult offspring
employees like to point out, part of the game is to
show bigger tax losses than you actually incurred. So these returns do in fact,
overestimate the losses. So to the extent that these
are real economic losses that offset future income,
this is not financial wizardry, this is just going back to square one, to go back to the Marty Ginsburg point, imagine you're at a casino, which with Trump that's an actual thing, you start playing blackjack
and you lose $1,000, then you go back to the
table, and you keep playing, and you actually win $1,000. Well, that prior loss of
$1,000 will offset the profit of the future income that
you have winning $1,000. But you're really just
back to where you started. So that's why you're able
to use the prior loss to offset this "gain" that
you incurred by winning. And that's essentially
what's happening here. It's not financial wizardry, it's just going back to square one. But it appears from the returns that Trump's entire business empire was based on exactly that premise. He runs up big debts, goes bankrupt, and then gets to write
off those huge debts for several years, then starts the process all over again. The Apprentice was really
the first time Donald Trump ever hit a basis clearing
home run in licensing and making enough cash to prop up his other failed businesses. But by the time that he was president, that money was gone too. And that's why people are freaking out about the number $421 million, because that's how much Donald Trump personally owes to other creditors. And people are worried that this is a national security issue that the sitting President
of the United States owes over $420 million to people unknown, including potentially foreign sources we don't actually know. And it appears that most
if not all of those loans are going to come due in a balloon payment that will happen if he's
elected to a second term, which is completely uncharted territory, that a sitting president
of the United States will have to negotiate with
creditors, domestic and foreign. And of course, people remember that to avoid exactly
these kinds of conflicts, Jimmy Carter had to put his
peanut farm in a blind trust to avoid the appearance of impropriety. And this also raises the
difference between the fact that a lot of corporations in
United States pay no taxes, but usually the
individuals, the employees, and the people that own those corporations do often pay taxes. The average tax rate for a
millionaire or billionaire in the United States is about 25%, which is lower than the average taxes that a normal person is going to pay but still well above the
zero taxes that Donald Trump has paid for most of his career. And here Donald Trump's
personal tax liabilities almost inextricably linked
to the Trump Organization because they're passed through entities. So there's a big difference between a corporation like Amazon that gets taxed as a corporation and an LLC, which just
the tax is passed through to the person or people that own it. And let's talk about Amazon for a second because that's an interesting comparison. Amazon famously pays little to no taxes. And this appears to be legal. But this is very different from what the Trump Organization does. Amazon is a business that reinvests all of its profit back into
the business year after year. So for years, Jeff Bezos
was focused on making Amazon as big as possible, dominating
the online shopping space to such an extent that the company was even able to pressure
brick and mortar retailers by undercutting their profits. And the company did this
by aggressively investing in research and development and borrowing more and more money to grow even bigger. If Amazon had kept more of its profits, it's reported income would
have been much higher, and they would be responsible for paying higher taxes on those profits. But the Trump Organization appears to be a different animal entirely. It doesn't have research
and development costs, it's not buying more and more assets to offset any particular profit. And Donald Trump's main place have always been in real
estate and licensing. And it appears that the losses that he's reporting on his taxes are actual losses that his businesses have been suffering year,
after year, after year. They're not necessarily paper
losses that are offsetting a whole bunch of revenue in other places, his businesses are
generating loss after loss. And in some cases, it's not clear where the money is coming from to prop up these businesses that lose hundreds of millions of
dollars year over year. And the bottom line is that rich people do pay less in taxes in the US. But even still, Donald Trump should have been paying some taxes and all the tax avoidance
strategies in the world still don't make this typical situation. When asked about the tax returns
at the presidential debate, President Trump said that
he'd paid millions in taxes. - I paid millions of dollars in taxes, millions of dollars of income tax, I paid $38 million one year. I paid $27 million one year.
- Show us you tax returns. - And he might have but almost certainly not
federal income taxes. Perhaps he's paid property
taxes or payroll taxes but not income taxes. Tax experts say that he
can clear everything up by releasing a single page of his 1040 to show just how much he has paid in taxes without divulging more information, but he's provided no concrete details to dispute any part of The
New York Times reporting. And the worst issue is that many of the President's properties are being held up artificially with loans. For many he hasn't paid a
single dime of principle, and hundreds of millions
of dollars in loans are coming due in the next four years. And because the properties are so risky, Trump had to personally
guarantee the loans, meaning that even if the property fails, the creditor can go after Trump himself. One might be able to refinance these loans but that's extremely difficult when the underlying properties are losing money hand over fist. And it's completely uncharted territory for a sitting president to
either renegotiate the loans or have a creditor foreclose
on the sitting president. Not to mention the obvious
conflicts of interest. Nancy Pelosi and other Democrats have called this a
national security issue. - He has exposure to the tune of hundreds
of millions of dollars to whom over $400 million in leverage that somebody has over the
President of the United States. - Some have pointed out that such leverage often prevents individuals from getting even a security clearance
for the exact same reason. - One of the most important things that the FBI and the
background checks look into is are you potentially
beholden to anybody, or any entity, any country that could use that leverage against the interests of the United States in our national security, in order to extort or exploit
or otherwise manipulate you. - Though by the same token, the total assets that President Trump has are probably worth
enough to cover the loans if he liquidated all of these properties. They are not worth what
Trump says they're worth, sometimes he claims $2.5 billion dollars. But if you liquidated all the assets, it would probably be enough
to cover the $421 million that is likely to come
due in balloon payments in the next four years. But this is surprising only to people who haven't been paying attention. Recall that the Trump foundation charity was shut down for fraud. Trump University paid a
settlement of $25 million for essentially defrauding students, though it admitted no fault. And we already knew that President Trump owes Deutsche Bank hundreds
of millions of dollars and The Times investigation reveals that his business enterprises are once again on the verge of bankruptcy. Now, there will inevitably
be people that argue that Trump's ability to beat the taxman is just evidence that he's smart. But recall that tax problems are the ones that brought down Al Capone. And nobody ever thought that his ability to evade taxes was a qualification for President. And it's possible the only difference between Capone and Trump is
that Capone went to prison while Trump went to the Oval Office. But that doesn't mean that President Trump couldn't use a refresher on what it takes to run
a successful business. After all, he's lost billions of dollars stiffed banks and contractors, and had many businesses go bankrupt. But the best place for him to brush up on his business acumen
isn't Trump University, it's Skillshare, which offers classes on how to manage every aspect
of new business ventures. Donald Trump has a lot in
common with freelancers who are struggling to
understand the US tax code and the class, Bookkeeping
For Freelancers, how to handle your
finances by Emily Simcox, will really demystify the tax season for Trump and anybody else. The class teaches students on how to choose the
right bookkeeping method, how to categorize and track expenses, and how to stay organized
throughout the year even in years you're being
impeached or audited. Simcox breaks down the ins
and outs of bookkeeping into terms that even a graduate of Trump University could understand. Trump could also benefit from Guy Kawasaki Skillshare class, Art of the Start, turning ideas
into high growth businesses. So you can actually start a money generating business for once. Skillshare as you know, is an online learning community that has 10s of thousands
of classes on everything like illustration, creative
writing, music and productivity. The first 1,000 LegalEagles
will get two free months of Skillshare premium when you click on the
link in the description. And after the trial ends Skillshare is still way more affordable than most online learning platforms with plans starting at
less than $10 a month. Plus clicking on the
link in the description really helps out this channel. So just click on the
link in the description to get two free months of Skillshare. So do you agree with my analysis? Do you think President Trump
is a tax cheat or a tax genius? Leave your objections in the comments, and check out this playlist over here with all of my other law reviews
of the current legal issues including lots of stuff going on in the Trump administration. So just click on this playlist
and I'll see you in court.
That transition to the Skill Share plug was smooth af ngl