The Artful Tax Dodger

Killer does not care about the environment--he has proved that as he rolled back over a hundred protection rules. Except when it comes to tax subsidies. Associated Press reports that conservation officials in Scotland have cancelled his Aberdeenshire golf resort's special status for protecting the coastal sand dunes on the course. [photo:Trump International Scotland] NatureScot, the country's environmental protection agency said the dunes no longer merit "special scientific interest" despite efforts to protect rare habitats and plants remaining there. Scottish authorities have approved plans for a second golf course next to the original one on his estate.  The existing golf course and luxury hotel have not been profitable since they opened.  Conservationists deplored the decision, which they say shows that golf still trumps natural heritage in Scotland. Opening a second course will cause further harm to the dune system that was of great scientific interest.  Undoubtedly, Trump received some special tax treatment for his resort because of the conservation designation.

Killer has a history of seeking and obtaining protective designations for his properties in order to take advantage of special tax incentives.  A prime example is his Seven Springs estate, which includes rolling woodlands covering three Westchester County, NY townships.  He agreed to conservation easement to preserve these woodlands in exchange for $21.1 million tax break according to court records examined by the Washington Post.  The size of this windfall was set by 2016 assessment that was double that of the townships' assessment of the estate.  That assessment has become embroiled in the investigation being conducted by New York attorney general, Letitia James.  In question is whether the estate's value was inflated as part of the conservation easement tax break.

The Trump associated firm which established the value assumed a future buyer could build twenty-four $2.1 million mansions on the land without evidence that such projected developments could meet local regulations.  Killer himself tried to build on Seven Springs--including a golf course--but the projects were stymied by local opposition and environmental disputes.  The appraisal also claimed the land preserved under the easement had no economic value of its own, a suspect opinion since the tax break is calculated by subtracting the value of the conserved property from the value of developed property.  Killer also wrote off as a business expense $2.2 million in property taxes by classifying Seven Springs as an investment property rather than a residence.  His family members have often described Seven Springs as a family retreat. [photo credit: Washington Post]

The pink sandstone, sixty room mansion perched above a reservoir was built by the former owner of the Washington Post in 1919.  Killer bought the property in 1995 for $7.5 million with plans to transform it into a luxury hotel and private golf course, but these plans were never realized in the face of stiff opposition.  His plans were also complicated by the fact that three different town planning agencies were involved. He even rented the property to dictator Moammar Ghaddafi, who was in town for the UN General Assembly.  Ghaddafi staff's

promptly pitched a Bedouin tent in the yard. [photo: WaPo]  Local officials promptly issued a stop work order, deeming the tent a "temporary residence" that had no building permits.  A Bedford town supervisor expressed outrage that a "known criminal would attempt to set up camp in our community."  Killer claimed later in an interview that Ghaddafi "paid me a fortune" for the privilege.  He left unpaid a bill for Bedford town engineering services of $46,976.63, incurred to evaluate his building proposals.

The organization that Killer signed a preservation agreement with, North American Land Trust, has been involved in eight high profile IRS easement cases, including four that involve golf courses. The 150 acres of wooded land covered by the easement is without doubt of ecological value since it contains mature stands of hardwoods, and is adjacent to another tract of preserved forest. Cushman & Wakefield, the appraisal company whose headquarters are in a building co-owed with the Trump Organization, does not mention the development difficulties associated with the estate, nor does it offer evidence that a proposed luxury subdivision could meet strict local planning regulations.  Conserved land has economic value and is often bought and sold. Despite the easement the owner has many use rights including hunting, recreational vehicle traffic, erection of storage facilities and subdivision.

As in any appraisal situation, the valuation depends on who is "sprinkling the fairy dust'.  Eric Trump, who is allegedly handling Trump Organization affairs during his father's public service, relied on a long-time Washington attorney Sheri Dillon during the easement process. Dillon put pressure on Cushman & Wakefield to up the value of the land if it were developed, after her client "blew up on her".Cushman appraisers asked Dillon to back off since the issues had already been discussed.

Killer is not alone in abusing tax breaks to encourage conservation. In 2014  3,219 rich people claimed $3.2 billion in charitable deductions for conservation easements. An IRS analysis conducted in 2017 showed that conservation easement investors “claimed an average of $9 in tax deductions for every dollar they put in.”  The conservation provisions are so abused that the IRS declared the tactic part of their 2019 "dirty dozen" tax scams to avoid. In 2015 he told AP that his company had claimed $63.825 million in conservation easements since 2010, including a $25 million tax break for his Los Angeles National golf course in 2014. In 2017 the Palm Beach Post reported that Killer claimed a $5.7 million historic easement for his new resort home, Mar-A-Lago, which is criticized as a quid pro quo for development permission, not a charitable contribution. Killer told a 2016 campaign crowd in Pueblo, CO, “As a businessman and real estate developer…I have brilliantly used those [easement] laws. At last, a true statement from the Killer on Fifth Avenue! 

Only loosers pay taxes....