Jay, if Bragg isn't a subscriber, please send him a copy of this. Probably he and his team have already thought about tax evasion--maybe it'll be in the charges--but no harm in a reminder. When it comes to Trump, there's nasty things under every rock. Turn 'em all over and let the sunshine do its job.
I’m sure he’s inundated with advice these days… and that he’s likely also considering tax evasion, since it was what he nailed the Trump Org on not long ago!
Pretty sure that like most if not all his “business” dealings, Individual 1 cooked the books. Like the grifter he is and always has been, he and his henchmen would do anything to make a buck by cheating the taxman. That’s why he hires oodles of lawyers and accountants to squirrel away his money by using every loophole, legal, semi-legal, or otherwise…
Seen in any light save Jim Jordan's jaundiced hellscape eye sockets, what you describe is deliberate fraud in the Trump tradition of lifelong commitment to deceit and dishonor. Finally the chickens come tripping in.
@jaykuo So, if Trump is convicted of a felony, can he still vote? Especially in Florida where DeSantis has been on a tear to arrest people for voting “illegally”.
Just as an FYI, the president appoints the IRS commissioner and the Treasury secretary. The commissioner he appointed also happens to be in business with trump, in real estate of course, in Hawaii I believe. Either of these men would have it in their power to quash an audit.
That would be a fair assumption. He was very careful with his appointees-always getting his
‘Loyalty Pledge’ first, which in and of itself is arguably illegal. Everyone was connected to Trump World in some form or fashion. And it’s why Republicans won’t stand for funding the IRS now that some of his picks are gone. I’ve been musing lately whether citizens (en masse) could sue them for blocking citizens access to the IRS to work out tax issues they raise (something I have experienced recently; I’m sure many have) thus resulting in, constitutionally speaking, taxation without representation...or something akin to it. I have an appt to discuss it with my Congressman (Colin Allred-he lives in my area) in August. He’s a civil rights lawyer.
I have seen mention in the media of possible tax evasion issues in the Daniels case, but none so clearly set forth. Is trump's panic because he knows that Bragg has his state tax returns? (I don't know whether Bragg does, but it seems possible.)
On the Federal Level--IS the IRS now doing the audit it ducked while trump was president? If so, they surely now know what to look for.
Well, Jay, there IS the squabble over Biden wanting to add to the IRS work force to the tune of some 80K agents over the next 10 years and the other party being unwilling to have anything to do with it. I'd suggest they have some serious staffing issues.
except it isn't a squabble. It's already passed Congress and the move against it is going to get vetoed. Unless it is new the blackmail behind the debt ceiling.
I suppose it depends on how many "highly competent" auditors they are able to find to hire. And I suspect the audit results would remain secret unless the IRS decided to prosecute. It could be that the IRS figures trump will get his comeuppance in multiple elsewheres and the cost-effective use of the new agents is to go after some other really big fish. Hope they concentrate on Peter Thiel.
Jay: Very interesting analysis. As a former federal, not state, prosecutor, I have been trying to parse the false business records crime. The issue to me is that the statutory provision seems to require that at the time that you are making the false entry in the business records, you need to do so intending to further (or conceal) the other crime, here tax evasion. The problem for D.A. Bragg in charging tax evasion might be that the tax fraud is the subsequent result of the false business entry -- you make the hush money payment, falsely book it as legal expense and then, when the tax return is filed, you take it as inappropriate expense, illegally reducing your income and, thus, your taxes. The false entry -- disguising and recording them as legal fees -- is done to further and conceal the hush money payment (not a crime in and of itself) and not the subsequent tax fraud. Perhaps Cohen, with the convicted CFO Allen Weisselberg, along with Trump, discussed how this was all going to be handled from a tax perspective at the outset. If so, you would have a charge -- not only a felony false business records one, but a state tax fraud charge as well.
It surely will depend on the facts and what they can prove here. I don’t know when the scheme was hatched, but at the time they falsified the records they probably knew that it would help them evade taxes. Whether that has to be the dominant or just one of the reasons they did so isn’t clear.
Thanks Jay. Totally agree that the charge is highly fact specific. Thinking about it further, Trump regularly stiffed his contractors, including his attorneys, and Cohen was clearly aware of it. Further, given how cheap Trump supposedly is, it is highly unlikely that Trump agreed to gross up the payments to Cohen (to $360K, plus a bonus) to cover Cohen's taxes -- which Cohen presumably asked for and discussed with Trump -- without also considering and presumably discussing the fact that Trump himself or the Trump organization would suffer financially unless the disguised payments would be characterized and treated as deductible legal expenses.
Evidence of discussions of the tax implications of the payments would presumably have to come from Cohen, who has his credibility issues. But that concern would be lessened if there are notes corroborating the discussions. If I am not mistaken, Cohen said Weisselberg took notes of the discussions. That would surely help.
Really liked reading this analysis. And hope Bragg and his team really have something like this "up their sleeve", for enhanced charges against T-45! Actually sounds like a much more promising case for the Manhattan DA to pursue!
Excellent analysis. For some time I hoped that Trump would get convicted of tax evasion for “cooking the books “ and avoid taxes. This adds to the case of tax evasion/tax fraud. It fits the way that Capone got convicted and sent to federal prison. Every day I hope that will happen.
Then with his many other cronies, they all should stay in prison for a long, long time.
Great analysis. But what I wonder (sorry I can't help it), that tfg should have been caught a long time ago because he's just so stupid and his attorneys are too. I'm talking about decades ago. But who was in charge of the DA's office(s) that never, ever looked into all his and his father's shady dealings? And then the second thing I wonder (sorry again) is if he got away with it for so long and he's stupid, how many other wealthy scumbags are also getting away with it because they aren't stupid? Are our tax laws written to favor the wealthy? Because the peons like me have to pay our taxes and can't afford attorneys to come up with schemes like this.
The NYT usually gives three free views, so you can probably click the link I'd gift it, but am running out of gifts for the month.
I lived in NYC during Morgenthau's tenure as DA, and during TFG's rise. The nature of my work had me crossing paths with TFG occasionally (Ivana more frequently), and I can honestly say my impression of the man hasn't changed and is the same as Morgenthau's. Swarmy is the word that I used at the time.
As a hypothesis, good, logical thinking. I have to ask, if indeed this is the case. How much cooperation do you thing Bragg has had/would have had from Letitia James's office?
I also keep coming back to Mazars resigning, and suspect this case is no different than any of the others.
They were cooperating for some time on the false financial statements case but it’s not clear what became of that cooperation once Bragg decided not to pursue it as a criminal matter.
I have no doubt that tRump engaged in countless acts of tax fraud over his career. What seems a lifetime ago, I was an executive in the hospitality business. It was the worst kept secret that every executive in the hotel business knew he was a fraud, both as a person and in his business dealings. If only someone could audit his books -- both the fake ones and the real ones -- then there would be an easy case for tax fraud. I suppose the kicker is how to get a court to compel their release. And then there is Deutsche Bank, who, perhaps, is complicit in all of this.
So the Trump organization committed tax fraud, reducing its income and tax by claiming an illegitimate expense. But in Trump’s personal return would not his income from the Trump organization have been higher and his tax higher not lower? So to get Trump on this fraud the prosecution would have to show his culpability at the Trump organization, a difficult show.
The Trump Organization is a pass through entity, I believe, made up of many other entities. If the Trump Organization reduces its taxable income with an expense reduction, the amount of income it is taxed on is reduced, so the tax bill is lower. If there’s an accountant among us who disagrees, I’m very open to being corrected.
If it’s a pass through, then there would be a tax benefit for Trump personally. The question then becomes proving Trump’s responsibility for putting the fraudulent entry on the Trump organization’s books and tax return. Getting anyone to testify is a problem and there may be no damning documents.
I never understood why the fact that it was disguised as a business expense was apparently ignored, at least by the media, but my favorite part of Jay's piece, that I did not know, was that Stormy actually cost the Orange Man $420,000!
Umm, the media seems easily led by insignificant details these days and only lend to the confusion. Jay, Joyce Vance, and HCR do a better job in their respective areas. Emptywheel calls these people "Pavlov Journalists" and she's not far off.
Jay, if Bragg isn't a subscriber, please send him a copy of this. Probably he and his team have already thought about tax evasion--maybe it'll be in the charges--but no harm in a reminder. When it comes to Trump, there's nasty things under every rock. Turn 'em all over and let the sunshine do its job.
I’m sure he’s inundated with advice these days… and that he’s likely also considering tax evasion, since it was what he nailed the Trump Org on not long ago!
Pretty sure that like most if not all his “business” dealings, Individual 1 cooked the books. Like the grifter he is and always has been, he and his henchmen would do anything to make a buck by cheating the taxman. That’s why he hires oodles of lawyers and accountants to squirrel away his money by using every loophole, legal, semi-legal, or otherwise…
Great analysis, Jay. Spot on.
Seen in any light save Jim Jordan's jaundiced hellscape eye sockets, what you describe is deliberate fraud in the Trump tradition of lifelong commitment to deceit and dishonor. Finally the chickens come tripping in.
@jaykuo So, if Trump is convicted of a felony, can he still vote? Especially in Florida where DeSantis has been on a tear to arrest people for voting “illegally”.
Not in Florida unless he has finished serving his time and paid off all his fees!
LOL! what a thought.
It’s kind of what I’ve been hoping. But he’s never been charged with it yet even tho the IRS likely could’ve. Many times!
Which is the reason why the IRS was gutted and the republicans don't want more agents hired over the course of 10 years.
He must have friends at the IRS, no? The coincidences of the 2 audits, Mr Comey and Mr McCabe, lead me to that conclusion.
Just as an FYI, the president appoints the IRS commissioner and the Treasury secretary. The commissioner he appointed also happens to be in business with trump, in real estate of course, in Hawaii I believe. Either of these men would have it in their power to quash an audit.
That would be a fair assumption. He was very careful with his appointees-always getting his
‘Loyalty Pledge’ first, which in and of itself is arguably illegal. Everyone was connected to Trump World in some form or fashion. And it’s why Republicans won’t stand for funding the IRS now that some of his picks are gone. I’ve been musing lately whether citizens (en masse) could sue them for blocking citizens access to the IRS to work out tax issues they raise (something I have experienced recently; I’m sure many have) thus resulting in, constitutionally speaking, taxation without representation...or something akin to it. I have an appt to discuss it with my Congressman (Colin Allred-he lives in my area) in August. He’s a civil rights lawyer.
I hope that meeting bears good fruit. Thank you for being active in attempting to put things in the place where they logically belong.
I don't think it's so much friends at the IRS but friends that tax cheat as well.
...and if Mr Trouble was behind those audits I find that to be exceedingly LOW. Very very nasty.
I have seen mention in the media of possible tax evasion issues in the Daniels case, but none so clearly set forth. Is trump's panic because he knows that Bragg has his state tax returns? (I don't know whether Bragg does, but it seems possible.)
On the Federal Level--IS the IRS now doing the audit it ducked while trump was president? If so, they surely now know what to look for.
My understanding is that the IRS is not doing an audit due to the “challenges” of the task. Isn’t that what we pay them for though?
Well, Jay, there IS the squabble over Biden wanting to add to the IRS work force to the tune of some 80K agents over the next 10 years and the other party being unwilling to have anything to do with it. I'd suggest they have some serious staffing issues.
except it isn't a squabble. It's already passed Congress and the move against it is going to get vetoed. Unless it is new the blackmail behind the debt ceiling.
I suppose it depends on how many "highly competent" auditors they are able to find to hire. And I suspect the audit results would remain secret unless the IRS decided to prosecute. It could be that the IRS figures trump will get his comeuppance in multiple elsewheres and the cost-effective use of the new agents is to go after some other really big fish. Hope they concentrate on Peter Thiel.
Jay: Very interesting analysis. As a former federal, not state, prosecutor, I have been trying to parse the false business records crime. The issue to me is that the statutory provision seems to require that at the time that you are making the false entry in the business records, you need to do so intending to further (or conceal) the other crime, here tax evasion. The problem for D.A. Bragg in charging tax evasion might be that the tax fraud is the subsequent result of the false business entry -- you make the hush money payment, falsely book it as legal expense and then, when the tax return is filed, you take it as inappropriate expense, illegally reducing your income and, thus, your taxes. The false entry -- disguising and recording them as legal fees -- is done to further and conceal the hush money payment (not a crime in and of itself) and not the subsequent tax fraud. Perhaps Cohen, with the convicted CFO Allen Weisselberg, along with Trump, discussed how this was all going to be handled from a tax perspective at the outset. If so, you would have a charge -- not only a felony false business records one, but a state tax fraud charge as well.
It surely will depend on the facts and what they can prove here. I don’t know when the scheme was hatched, but at the time they falsified the records they probably knew that it would help them evade taxes. Whether that has to be the dominant or just one of the reasons they did so isn’t clear.
Thanks Jay. Totally agree that the charge is highly fact specific. Thinking about it further, Trump regularly stiffed his contractors, including his attorneys, and Cohen was clearly aware of it. Further, given how cheap Trump supposedly is, it is highly unlikely that Trump agreed to gross up the payments to Cohen (to $360K, plus a bonus) to cover Cohen's taxes -- which Cohen presumably asked for and discussed with Trump -- without also considering and presumably discussing the fact that Trump himself or the Trump organization would suffer financially unless the disguised payments would be characterized and treated as deductible legal expenses.
Evidence of discussions of the tax implications of the payments would presumably have to come from Cohen, who has his credibility issues. But that concern would be lessened if there are notes corroborating the discussions. If I am not mistaken, Cohen said Weisselberg took notes of the discussions. That would surely help.
Really liked reading this analysis. And hope Bragg and his team really have something like this "up their sleeve", for enhanced charges against T-45! Actually sounds like a much more promising case for the Manhattan DA to pursue!
Thanks Jay!
Excellent analysis. For some time I hoped that Trump would get convicted of tax evasion for “cooking the books “ and avoid taxes. This adds to the case of tax evasion/tax fraud. It fits the way that Capone got convicted and sent to federal prison. Every day I hope that will happen.
Then with his many other cronies, they all should stay in prison for a long, long time.
I find this thinking...just delightful! Thank you!
Great analysis. But what I wonder (sorry I can't help it), that tfg should have been caught a long time ago because he's just so stupid and his attorneys are too. I'm talking about decades ago. But who was in charge of the DA's office(s) that never, ever looked into all his and his father's shady dealings? And then the second thing I wonder (sorry again) is if he got away with it for so long and he's stupid, how many other wealthy scumbags are also getting away with it because they aren't stupid? Are our tax laws written to favor the wealthy? Because the peons like me have to pay our taxes and can't afford attorneys to come up with schemes like this.
I recently saw an article on Robert Morgenthau, who was the DA in Manhattan for decades. Trump schmoozed him and befriended him, donated to his campaigns, etc. but when Morgenthau was dying, someone asked him what he feared most and he said Trump. Here’s a link. https://www.nytimes.com/2023/03/20/opinion/donald-trump-friendship-with-robert-morgenthau.html
I don't subcribe to the NYT, but that makes sense. His legacy is threatened due to all the favors he did for tfg just like Giuliani.
The NYT usually gives three free views, so you can probably click the link I'd gift it, but am running out of gifts for the month.
I lived in NYC during Morgenthau's tenure as DA, and during TFG's rise. The nature of my work had me crossing paths with TFG occasionally (Ivana more frequently), and I can honestly say my impression of the man hasn't changed and is the same as Morgenthau's. Swarmy is the word that I used at the time.
As a hypothesis, good, logical thinking. I have to ask, if indeed this is the case. How much cooperation do you thing Bragg has had/would have had from Letitia James's office?
I also keep coming back to Mazars resigning, and suspect this case is no different than any of the others.
They were cooperating for some time on the false financial statements case but it’s not clear what became of that cooperation once Bragg decided not to pursue it as a criminal matter.
I have no doubt that tRump engaged in countless acts of tax fraud over his career. What seems a lifetime ago, I was an executive in the hospitality business. It was the worst kept secret that every executive in the hotel business knew he was a fraud, both as a person and in his business dealings. If only someone could audit his books -- both the fake ones and the real ones -- then there would be an easy case for tax fraud. I suppose the kicker is how to get a court to compel their release. And then there is Deutsche Bank, who, perhaps, is complicit in all of this.
So the Trump organization committed tax fraud, reducing its income and tax by claiming an illegitimate expense. But in Trump’s personal return would not his income from the Trump organization have been higher and his tax higher not lower? So to get Trump on this fraud the prosecution would have to show his culpability at the Trump organization, a difficult show.
The Trump Organization is a pass through entity, I believe, made up of many other entities. If the Trump Organization reduces its taxable income with an expense reduction, the amount of income it is taxed on is reduced, so the tax bill is lower. If there’s an accountant among us who disagrees, I’m very open to being corrected.
If it’s a pass through, then there would be a tax benefit for Trump personally. The question then becomes proving Trump’s responsibility for putting the fraudulent entry on the Trump organization’s books and tax return. Getting anyone to testify is a problem and there may be no damning documents.
I never understood why the fact that it was disguised as a business expense was apparently ignored, at least by the media, but my favorite part of Jay's piece, that I did not know, was that Stormy actually cost the Orange Man $420,000!
Umm, the media seems easily led by insignificant details these days and only lend to the confusion. Jay, Joyce Vance, and HCR do a better job in their respective areas. Emptywheel calls these people "Pavlov Journalists" and she's not far off.