CHICAGO — There is new potential tax trouble for former President Donald Trump over his Chicago Tower.
An IRS audit uncovered by the New York Times and ProPublica found that Trump effectively wrote off losses twice- in 2008 and again in 2010.
The audit is still underway, although Eric Trump told the publications the matter was settled.
A revised tax bill could cost Trump more than $100 million.
The IRS alleges that Trump used a dubious accounting maneuver to claim improper tax breaks from his troubled Chicago tower.
The 92-story, glass-sheathed skyscraper along the Chicago River is the tallest and, at least for now, the last major construction project by Trump. Through a combination of cost overruns and the bad luck of opening in the teeth of the Great Recession, it was also a vast money loser.
But when Trump sought to reap tax benefits from his losses, the IRS has argued, he went too far and in effect wrote off the same losses twice.
The first write-off came on Trump’s tax return for 2008. With sales lagging far behind projections, he claimed that his investment in the condo-hotel tower met the tax code definition of “worthless,” because his debt on the project meant he would never see a profit. That move resulted in Trump reporting losses as high as $651 million for the year, ProPublica and the Times found.
SOURCE: ProPublica