The Real Deal New York

Property tax appeals may show Trump’s financial disclosures to be overstated

Statements filed with the FEC don't match with income and expense forms he sent to city Tax Commission

November 04, 2016 09:40AM

A cat seeing a lion and Donald Trump (illustration by Lexi Pilgrim for The Real Deal)

A cat seeing a lion and Donald Trump (illustration by Lexi Pilgrim for The Real Deal)

A look into the income and expense forms Donald Trump filed with the city Tax Commission throws into question whether the figures he listed on his financial disclosure forms were accurate.

Large portions of the income Trump listed for his various business interests on financial disclosure forms represent gross income before costs like covering mortgage payments, payroll and maintenance, the New York Times reported.

But after those expenses, some of his companies make a small fraction of what he reports on the financial disclosures, and some actually lose money, according to the Times’ review of paperwork he filed with the city’s Tax Commission.

At 40 Wall Street, for example, Trump wrote in his book “Never Give Up” that the building makes approximately $20 million a year in rent and was worth $500 million in 2008, the year the book was published.

On financial disclosure forms filed with the Federal Election Commission, the Republican presidential candidate listed the property’s income at more than $5 million, the highest category on the form.

But the forms he filed with the city Tax Commission to appeal 40 Wall Street’s property taxes show that after mortgage payments and other costs, the building’s cash flow in 2014 was $104,000. During the previous three years, in the fallout of the 2008 financial crisis, it had negative cash flow of $5.5 million.

When the property turned around last year and occupancy rose to 95 percent, the income after expenses was listed at just shy of $3 million, still far short of the more than $5 million Trump reported. The property also paid the Trump Organization $966,000 in management fees, according to the Times.

Trump also owns a parking garage and the restaurant space at the Trump International Hotel and Tower on Columbus Circle, where income was listed on his financial disclosure forms at somewhere between $1 million and $5 million.

His income and expense statements for his 2015 property tax appeal, however, show that after he paid operating expenses and mortgage payments only $43,000 was left. His company collected a $50,000 management fee on the pair of spaces.

Trump, like many developers, has used loopholes in the tax code to his advantage, and he may have legally avoided paying federal income taxes for up to 18 years.

The income and expense statements are not available for every property, and some do show cash flows to be closer to the figures listed on his financial disclosure forms.

Trump Tower, for example, produced positive cash flow of $13 million in 2015 even after mortgage payments. That lines up with the financial disclosure forms listing income of more than $5 million. [NYT]Rich Bockmann

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