For several years now, Trump has reported that he owes over $50 million to Chicago Unit Acquisition, LLC — a company he owns. It turns out that debt may not exist at all.
Mother Jones is reporting that the massive debt may have been “concocted as a ploy to evade income taxes—a move that could constitute tax fraud.”
We only know about this debt because Trump must file personal financial disclosure forms as president. Those forms are much vaguer than tax returns. The filer needs only to disclose debts and assets within huge ranges.
For example, Trump says the value of his assets in DJT Holdings, one of the hundreds of companies listed on his disclosure form, is somewhere between $5 million and $25 million. And the form doesn’t allow for anything over $50 million, so the filer can note assets or debts of “over $50 million” and that could represent $51 million or hundreds of millions of dollars.
It’s weird enough that Trump is reporting at least an 8-figure debt to himself. But, per Mother Jones, it gets weirder. The loan is related to Trump Tower Chicago, but Chicago Unit Acquisition is basically a cipher. It doesn’t earn anything, and it doesn’t seem to have any value, but it should if Trump is making payments on the loan.
Weirder still: it’s a springing loan. Those are made to borrowers “who are viewed as credit risks” and come with “harsh repayment terms.” There’s no doubt Trump is a terrible credit risk. His companies have gone bankrupt multiple times, and he’s really not a great businessman.
But Trump made this loan to himself. Setting aside the inherent illogic of a Trump company making a high-risk loan to Trump, it’s even odder that he’d impose harsh terms on himself.
This is what happens when you elect a person someone who bragged he was the “king of debt,” refused to release his tax returns, and refused to divest from his companies: a tangled mess of assets and debts that no one can figure out.
Trump’s explanation of the loan, given to the New York Times in 2016, doesn’t make things any clearer. “We don’t assess any value to it because we don’t care. “I have the mortgage. That is all there is. Very simple. I am the bank.”
It was the casual “we don’t care” that piqued Mother Jones’ interest, as it might be “an admission that he has no intention of repaying the loan.” It isn’t like that would be the first time. But what if there was no loan in the first place? Or, more accurately, what if it was cover for something else?
This may have arisen because one of the debts related to Trump Tower Chicago was canceled, and Trump didn’t have to pay the full value. But when a debt is canceled, you still owe taxes on it — it’s income. And that canceled debt may have been as much as $48 million. But he didn’t want to pay taxes, because he hates paying taxes. So what if, postulates Mother Jones, Trump just invented this giant loan, so he doesn’t have to pay taxes on that $48 million?
Experts interviewed by Mother Jones say it’s not all that hard to fake a loan, but doing so, if you put the debt on your federal tax returns, is against the law. Not that Trump cares about the law, tax or otherwise.
If the House of Representatives could crack open Trump’s tax returns, much of this could be solved. But that effort is bogged down in litigation while Trump tries everything to stop them. However Deutsche Bank has admitted they have Trump’s returns, and it’s a lot tougher for Trump to block a third party from giving up the documents indefinitely. He’s still going to try, though. He’s gotten away with it for this long.