Donald Trump avoided paying taxes on hundreds of millions in casino debt

Tuesday, November 1, 2016

The Trump Taj Mahal in Atlantic City, New Jersey, closed on October 10, 2016, after suffering numerous financial problems. Photo by Jesper Rautell Balle

Republican presidential nominee Donald Trump avoided paying taxes on hundreds of millions of dollars in casino debt, The New York Times reports.

During the early 1990s, Trump racked up $1.3 billion in debt in connection with his failed casinos in New Jersey, the paper said. But he convinced lenders to forgive some of his debt, a common practice in the financial industry.

Normally, Trump would had to report the canceled debt as income. Instead, he came up with a "stock-for-debt swap" and never paid taxes on it, according to the paper, which cited documents filed in connection with the bankruptcies of his three Atlantic City casinos.

"He’s getting something for absolutely nothing," John L. Buckley, a tax attorney who once worked for Congress, told The Times.

Congress has since barred stock-for-debt swaps by corporations and by partnerships. Trump was using a partnership to run his casinos at the time.

His Democratic rival in the presidential race, Hillary Clinton, voted to close the loophole for partnerships in 2004, The Times reported.

Read More on the Story:
Donald Trump Used Legally Dubious Method to Avoid Paying Taxes (The New York Times 11/1)

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