Even after taking office, President Donald Trump sold more than $35 million worth of real estate last year to secretive buyers.
Trump sold 41 luxury condo units in Las Vegas last year to people who used limited liability companies (LLCs), which allow them to hide their identities, a USA Today review found. The president can withdraw profits from these sales at any time using a trust that names him as the sole beneficiary, but is managed by sons Donald Trump Jr. and Eric Trump.
Before Trump signed the tax bill into law in December 2017, a last-minute tax break was added for real estate investors who use LLCs, partnerships and S-corporations to make deals.
The number of buyers using LLCs to purchase property from Trump climbed even before the tax break was announced last year. A mere 4 percent of buyers used the secretive shell companies in the two years before Trump became the Republican nominee. A year later, the number dramatically increased to nearly 70 percent, according to USA Today.
One Chicago neurosurgeon, Ramis Ghaly, told the paper that he used an LLC to purchase a Trump condo in Las Vegas at the advice of his financial consultant. Ghaly said that the positives of the property outweighed his concerns about being associated with president’s politics.
But with a majority of buyers are choosing to remain anonymous, liberal watchdog groups including Citizens for Responsibility and Ethics in Washington (CREW) have raised questions about the transparency of Trump’s foreign deals. The sale of Trump’s Palm Beach mansion to a Russian oligarch Dmitry Rybolovlev in 2008 resurfaced last year after speculation that the Trump administration had colluded with Russia during his 2016 presidential campaign. Moreover, a Reuters report found that at least 63 people with “Russian passports or addresses” has purchased nearly $98.4 million worth of Trump’s property in South Florida. Trump has also sold his personal Park Avenue penthouse to Chinese investor Angela Chen.
“If someone wants to do business with the Trump entities in the form of an LLC, we look behind the LLC to see who the owner of it is and where the funding is coming from,” Bobby Burchfield, the ethics advisor at the Trump Organization told the publication. “If we can’t determine that, we won’t sign off on it.”
Before his inauguration, Trump announced that he would turn over his companies to his sons, but would not divest from his properties and assets.
“While I am not mandated to do this under the law, I feel it is visually important, as President, to in no way have a conflict of interest with my various businesses,” Trump said in a series of tweets in November 2016. “Hence, legal documents are being crafted which take me completely out of business operations. The Presidency is a far more important task!”
The tax break for LLCs, S-corps, LPs and other businesses permit owners to avoid paying business tax rates by allowing income to pass through to partners who will then pay an individual tax rate on the money.
New York real estate mogul Steve Witkoff told Newsweek in December the benefits of the tax bill reaped by real estate investors will trickle down into the economy.
“I think you’ve got to create all those conditions that get the private sector to want to invest,” Witkoff said. “The president’s game plan is more growth. Let’s add several trillion more dollars of GDP, expand the tax net, lower the amount that you pay, but expand it. More tax revenue means we’re going to pay down the deficit.”